SME Times News Bureau | 24 Apr, 2010
The Comptroller & Auditor General (CAG) on Friday slammed the Maharashtra government for losing nearly Rs.49.99 million (Rs.4.99 crore) in 2008 by not levying entertainment tax on the Indian Premier League (IPL) tourney.
"The IPL matches were purely of a commercial nature and the franchisee owners of the eight teams comprising business tycoons and film stars spent crores of rupees to buy the team and players from all the cricketing nations for the world’s richest cricket tournament," said the CAG report released in Mumbai on Friday evening.
The report pointed out that IPL was conceptualized as an entertainment spectacle and was pitched as the ultimate destination of television entertainment.
Hence it is obvious that the main objective of IPL was to provide entertainment and so it merited levy of tax on ticket sales.
The CAG pointed out that the Delhi government has treated IPL as a commercial venture and accordingly imposed duty on tickets.
Accordingly, since the IPL was purely a commercial venture, it had a great potential to generate revenue, the CAG said.
It also pointed out that the government should have obtained legislative sanction for exempting IPL from entertainment tax.
"Blanket exemptions should be granted merely on the basis of a government resolution of May 1964, much before the IPL was visualized," the report said.
This is the second time in two days that the state government has come under flak for not taking a decision to levy tax.
On Thursday, the Bombay High Court also rapped the government over the same issue in a public interest litigation filed by senior Shiv Sena leader and legislator Subhash Desai.
