IPL to pay entertainment tax in Maharashtra

New Delhi:

The Maharashtra Government has decided to levy entertainment tax on the organisers of the Indian Premier League.

The decision was taken at a cabinet meeting on Wednesday.

"The government has not charged any tax on the cricket matches so far and therefore, the decision has been taken at the cabinet meeting today," Chief Minister Ashok Chavan said.

"Considering the changing cricket scenario and commercialisation of the game, the government has decided to impose the entertainment tax," Principal Secretary of Revenue Department Ramesh Kumar said.

The quantum of tax for matches held in Mumbai will be 25 per cent and for those played at venues located within the jurisdiction of other municipal corporations will range between 15 and 20 per cent, Kumar said.

IPL Chairman Lalit Modi reacted swiftly saying he has no objections. "We will pay entertainment tax if we have to," he said.

The cash-driven annual T20 event has returned to India for the third season this year. The last edition was organised in South Africa due to security reasons.

Player auctions for IPL Season 3 were held in Mumbai on Tuesday. (IPL Pics: Who bought whom) A lot of money exchanged hands there with teams spending big amounts to bid for and buy players. (Blog: Blow by blow account)

Sources say the Mumbai Indians spent $2.75 million to purchase West Indies allrounder Keiron Pollard of this $750,000 as a maximum cap will go to the player and the rest goes into the IPL kitty. Similarly, the Kolkata Knight Riders purchase of Kiwi Shane Bond at a reported $1.3 million would put the difference between that sum and $750,000 in the IPL kitty. (Read: Pollard most expensive IPL player)

In the first season, no state other than Maharashtra had exempted IPL from paying entertainment tax. Interestingly, IPL had not demanded any such exemption.

Some states like West Bengal and Punjab had asked IPL to pay for the security arrangements as well.