India may lose T20 World Cup 2021 hosting rights over tax issues

08:51 PM | 27 May, 2020
India may lose T20 World Cup 2021 hosting rights over tax issues

SHARJAH – There are dim chances that India would be hosting T20 World Cup 2021 as the International Cricket Council (ICC) has threatened to shift the tournament from India for not securing tax exemption for the event.

The ICC, according to Indian media, has sent a threatening email to the The Board of Control for Cricket in India (BCCI), reminding it that the world’s cricket governing body reserves the right to shift the tournament to any other country.

The event is set to be held in October-November 2021.

The BCCI had been given time till May 18 to resolve the tax issues with the country’s government but it failed to do so. Citing the lockdown situation in the country, the board has requested the ICC to extend the deadline till June 30.

"In light of the BCCI's notification of force majeure, we would highlight the obligation on the BCCI of the Host Agreement and that IBC (ICC Business Corporation) is entitled to terminate the agreement with immediate effect at any time from 18 May 2020," Jonathan Hall, the ICC's general counsel, was quoted by ESPNcricinfo.

"The BCCI has clearly had many years to arrange the tax solution which is why the agreement asks for it to be provided .no later than 18 (eighteen) months prior. and why the BCCI was required to provide it by 31 December 2019. In such circumstances IBC is not prepared to agree to the requested extension to June 30, 2020 or 30 days after the lockdown is lifted whichever is later.

"In the meantime, all of IBC's rights are reserved in full including the right to challenge whether or not a valid force majeure exists," Hall wrote in a letter to the BCCI on April 29.

In the past, the ICC had suffered losses of millions of dollars after BCCI failed to secure tax exemption. India had also hosted the 2016 edition without getting tax exempted for the tournament, causing losses to the tune of $20-30 million to the cricket's world governing body.

The ICC would suffer a loss of around $100 million if the BCCI failed to meet the key requirement.

In response to ICC’s email the BCCI wrote, "While BCCI has been making all efforts to get a 'tax solution' for the event, in view of the current situation, which is beyond the control of the BCCI, it is not possible for BCCI to obtain requisite permission/consent from the Government of India before April 17, 2020. In light of the above, the BCCI hereby requests IBC to grant an extension of time till June 30, 2020 or 30 days after the lockdown is lifted, whichever is later.

"For the avoidance of doubt, this letter constitutes a notice of Force Majeure under Host Agreement," the BCCI told the ICC.