Just How Much Money Does The BCCI Make?

I’m sorry to continue writing about the BCCI; cricket administration isn’t my forte (nor is it a major theme of this blog). But seeing the quality of most cricket boards around the world, I think we ought to pay a little more attention to the overlords who supposedly take care of our game. So, some questions and answers:

1. Is the BCCI public or private? That is, is it a government agency, or a private corporation?

Well, here’s the tricky thing. For the ‘public’ argument: until a few years ago, the Indian government granted a tax exemption to the BCCI, a decision that meant the Indian government — which expends resources on cricket stadiums, security, etc. — collected zilch from one of the richest sporting bodies in the world. Then, in 2010, a government agency realized the exemption was silly because the BCCI is “no longer promoting cricket as a charitable activity and is now primarily a commercial entity.” As a result, the BCCI has paid more than 200 crore in taxes over the last couple of years, but that number may not be even close to their actual tax bill.

2. OK. So, given that they pay taxes and the Central government treats it like a business, the BCCI isn’t public, right?

Well, yes and no. Take a look, for instance, at the people who run the BCCI. Its working committee includes Anurag Thakur, a member of Parliament and Arun Jaitley, a leader of the federal opposition and a former Cabinet minister; the Finance Committee is led by J.M. Scindia, a minister of state in the central government; and the IPL committee is led by Rajeev Shukla, a former journalist and now a minister of state. I’m sure there are other political bigwigs on the list, but I think I’ve made my point: how private is an organization that is led by so many public figures?

Now, to be fair, the list includes a fair number of businessmen and ex-cricketers. And I’m sure some of these politicians have some knowledge and ability to contribute to the BCCI, but isn’t this all a flagrant violation of conflict-of-interest norms? Take a look, for example, at the U.S. Senate ethics code, which says:

A Senator and anyone earning an annual rate of pay above $25,000 and employed for more than 90 days in a calendar year:

  • May not affiliate with an outside business for the purpose of providing professional services (e.g., consulting, medical, real estate, insurance, or legal services) for compensation.
  • May not permit his or her name to be used by an outside business providing professional services for compensation.
  • May not practice a profession for compensation to any extent during regular office hours in the employing Senate office.
  • May practice a profession during off hours as long as the individual avoids affiliating with a firm.

If you say the BCCI is a private entity, then there’s no way these politicians can justify their decision to be a part of it (even though all BCCI officer holders are honorary). If you say the BCCI is a public entity, then it needs to be regulated better so that it is more accountable to taxpayers. And it’s not as if the conflict-of-interest is an abstract issue; the question has already come up in court:

A division bench of Justices P B Majmudar and R G Ketkar, while hearing the PIL filed by Shiv Sena leader Subhash Desai seeking a direction to the Maharashtra government to recover entertainment tax from IPL, asked the petitioner to make Pawar a party if he wanted to make allegations against him.

“If a minister holds a post in a cricket association, and the state cabinet is to decide on granting some exemption to the association…perhaps conflict of interest may arise,” the bench observed.

3. So how much money does this public/private organization make?

The thing is, no one really knows. In their latest release, the BCCI said it made a profit of roughly $40 million, mostly due to IPL largesse (profit: $25 million). But the IPL finances are notoriously shady and a Parliament steering committee has been trying to figure out how much tax the BCCI owes the government:

The Committee has noted that the Board had been enjoying questionable tax benefits having got exemption to the tune of Rs 225 cr before 2007 & having submitted only Rs 92 crore out of the Rs 118 crore that was demanded in 2007.

Moreover out of the Rs 375 crore Tax that that was demanded in 2 years from 2007 to 09, the BCCI has paid only Rs 249 crore.

The Committee said it’s astonished that the Income Tax Department could not finalise the assessment of income of BCCI for the last three years.

4. Where does that leave us?

Not sure. In the end, we have a bunch of political honchos running a game that makes hundreds of millions of dollars a year and is a national passion — but we don’t really know how transparent their books are; we don’t know why certain states levy an entertainment tax and others don’t; and we don’t know how professional the whole outfit is. The problem is that more government intervention isn’t necessarily the answer, but more transparency may be. Does anyone know, for example, if Indian MPs are required to disclose their incomes and stock holdings? Does anyone know if the BCCI has a charter that spells out how it’s possible that an office holder can also own an IPL franchise?

2 thoughts on “Just How Much Money Does The BCCI Make?

  1. fckingblog says:

    GoI to terminate the BCCI for non payment of dues?

  2. Cricblogger says:

    How does IPL result in such huge income. Is it just ticket sale and TV rights? What are the sources of income for IPL. 25 million from a few weeks of IPL is huge.

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