In India GST – Goods and Services Tax was implemented on July 1st, 2017. This is new tax regime is set to replace the existing Indirect tax regime of India. After all the hue and cry, the GST was implemented in India which subsumes the existing indirect taxes of India
A GST which is commonly described as an indirect, broad based consumption tax works on the concept of one nation one tax. It is indirect in the sense this tax is levied on goods and services and related undertakings, rather than straight on personal income. GST is more regressive in nature. GST is expected to have an intense effect on many sectors of the Indian economy, one such industry is the sporting bodies. These sporting bodies will now have to understand and function within the framework and difficulties of this new system of indirect taxation.
Under the GST regime, it is expected that many issues may arise which includes whether such organizations need to register under the new rules, as well as, how to treat the several pieces of training that are made to sporting bodies, including sponsorships and prize monies.
GST has brought in four tax slab rates – 5%, 12%, 18% and 28%. Under the old indirect tax scheme, these sporting bodies are paying tax @ 2% while as per the latest circular from the government on GST there has been an increase in the slab rates to 12 % to 28%. This will, in turn, make the sports equipment more expensive and unaffordable to the masses. There can be an increase in the tickets costs as well for the various sports events.
The current change might have a negative impression on the progress of the industry. On the one side government plans to make sports compulsory in schools and colleges and on the other side awareness and a step ahead to make sports culture in the country for the Commonwealth games like other countries China, Japan, and the USA. The sports goods receive no concession and this may impact the overall training sports culture in schools and colleges.
GST will impact not only on outdoor games but also indoor games like carom, chess boards, table tennis etc. The step has also displeased the sports specialists who believe that sports equipment should be low-cost for the players. The governments have to support by manufactured sports products in India at a cheaper rate, providing free cost quality equipment available to youngsters, tax relaxation to draw people to come and enjoy sports.
The Central Government and State Government may have to think differently to create a better sports culture in the country and better encourage the future upcoming generation towards this sports activity.