IBS Hyderabad

Academic Year – 2020-22

Goods and Services Tax
Semester 2
Course Faculty: CS. Pavana Jyothi (C-002)
Group Project: Affect of GST on Sports Sector

Student Name (Registration Number) Sector/Company Selected

Satyajit Nanda (20BSPHH01C1113) Sports Industry
Arnab Chakraborty (20BSPHH01C0228) Sports Industry
Aishwarya Pillai (20BSPHH01C0071) Sports Industry
Barkha (20BSPHH01C0284) Sports Industry
Abhijeet Kumar (20BSPHH01C0026) Sports Industry
Ankan Chakraborty (20BSPHH01C0164) Sports Industry
Ushita Sood (20BSPHH01C1386) Sports Industry
Uttkarsh Bairagi (20BSPHH01C1388) Sports Industry
Learning Outcomes from this Group Project Task: (Please write your major learning from this
NCP)
Declaration:
We declare that this assignment is our work and we have not copied it from any other student’s work or
from any other source except where due acknowledgement is made.

For Course Instructor’s use only:

Marks Obtained: Max. Marks: …………………………

Comments (For Instructor’s use only)

General Observations Suggestions for Improvement

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Introduction

Tax is not a temporary contribution, it is mandatory financial burden that is imposed by the
government on the income and business profits of the people. GST is an abbreviation of goods and
service taxes. It is an indirect tax which came into effect on 1st July 2017 for replacement of many
other indirect taxes like excise duty, vat, services tax etc defining Indian economy on the global
front under the tagline of “one tax one market”.

Goods and services around the country has a defined slab. The central government has assured
before implementing GST on July 1 that the GST slab would be around the value added tax (VAT)
on related items.

There are 4 different types of GST which is applied in India.

1) The Central Goods and Services Tax (CGST)

2) The State Goods and Service Tax (SGST)
3) The Union Territory Goods and Services Tax (UTGST)
4) The Integrated Goods and Services Tax (IGST)

CGST includes all the transactions of goods and services which takes place within the state. CGST
is claimed by the central body of the nation. SGST is one of the 2 taxes applied on any product or
service apart from CGST. SGST is claimed by the state government. IGST is applicable on the
interstate transactions of goods and services. Imports and exports of goods is considered in in this.

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The purpose of collecting GST is to add value at each stage of sale or purchase
in the supply chain. GST is levied at each stage in the supply chain with no differences in goods
and services.

GST applies “Harmonized system of Nomenclature”, an international system used for classifying
goods under international trade.

GST in sports means implication and application of indirect taxes on sports related items such as
apparels and sports equipment

GST in sports industry was not welcomed by the entrepreneurs in the industry as there was a drastic
change in the % level of taxes.

OBJECTIVES OF GST

1) One Country – One Tax

2) Consumption bases tax instead of Manufacturing
3) Uniform registration, payment and input credit
4) To eliminate the cascading effect of indirect taxes on single transaction
5) Subsume all indirect taxes at centre and state level
6) Reduce tax evasion and corruption
7) Increase compliance
8) Reducing economic distortions.

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Rate of Tax (GST) on Textile Goods:

Apparels and clothing falls under the chapter 61 of the HSN code. Under this
category any piece of clothing would be taxed 5% GST if taxable value of goods
does not exceed Rs. 1000 per piece. All types of apparel and clothing of sale value
exceeding Rs. 1000 per piece would be taxed 12 % GST

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HSN Description of Goods Unit GST Rates

CGST SGST IGST

61,62 & Articles of apparel and clothing accessories falling under chapter u 2.5% 2.5% 5%
63 61, 62 and 63, of sale value not exceeding Rs. 1000/- per
piece.

61,62 & Articles of apparel and clothing accessories falling under chapter u 6% 6% 12%
63 61, 62 and 63, of sale value exceeding Rs. 1000/- per piece.

LACK OF AWARENESS OF GST

GST during the initial stages it was difficult for small and medium based business, the level of
understanding to the various slab, registration procedure was quite complicated. There was a
complete shift of tax procedure wherein every company has to register themselves who fall under
that slab. Level of awareness towards GST among the small business owners is low. It was found
that the main areas to be focused include training and computer software availability. Initially
when GST was introduced the trading across the country faced many difficulties including flitches
in the GST portal, complicated tax procedure, irrational classification of goods in different tax
slabs, non-availability of refunds from the tax authority.

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PRE-GST Scenario in Sports Sector

Goods and Services Tax is an indirect or consumption tax used in India on the amount of goods
and services. It is a all-inclusive, multistage, destination-based tax: comprehensive because it has
included almost all the indirect taxes except a few public taxes. Multi-staged as it is, the GST is
executed at every step in the manufacture process, but is intended to be refunded to all parties in
the various stages of manufacture other than the closing customer and as a destination-based tax,
it is collected from point of consumption and not point of origin like earlier taxes.

Goods and services are classified into 5 different tax blocks for collection of tax - 0%, 5%, 12%,
18% and 28%. Petroleum goods, alcoholic beverage, and electricity are not burdened under GST
and instead are taxed distinctly by the individual state governments, as per the previous tax system.
There is a superior rate of 0.25% on rough precious and semi-precious stones and 3% on gold. In
adding, a cess of 22% or other rates on top of 28% GST applies on few items like fizzy snacks,
luxury cars and tobacco goods. Before GST, the legal tax rate for most things was about 26.5%,
After GST, most possessions are likely to be in the 18% tax slot.

The tax came into significance from 1st July 2017 through the application of the One Hundred and
First Amendment of the Constitution of India by the Indian government. The GST replaced
existing numerous taxes levied by the central and state governments.

The tax rates, rules and regulations are governed by the GST Council which consists of the finance
ministers of the central government and all the cities and states. The GST is meant to standby a
swing of indirect taxes with a joint tax and is therefore expected to reshape the country's 2.4
trillion-dollar budget, but its implementation has received criticism. Positive outcomes of the GST
include the travel time in interstate movement, which fallen by 20%, because of termination of
interstate check posts.

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GST or Goods and Services Tax substituted a slew of central and state taxes from July 1. For the
month of July, firms are required to file basic, self-assessed GST returns by August 20. They will
have to file complete returns in early September that itemise and reunite every single sales invoice.
Amongst all these, the Central Board of Excise and Customs has once again noted some common
use substances - and their pre-GST tax rates - where the tax incidence is lower or equal ever since
GST came into result. It has declared numerous "items of common use" comparing GST rates with
the earlier indirect taxes.

"Before GST tax incidence would be upper if the tax occurrence on account of Central Sales Tax,
octree, entry tax etc. (which is more than 2%) is also included," said the part of the revenue
department under the finance ministry

Along with GST, there comes a lot of sales, reductions and suggestions, as brands are eyeing on
clearing their stocks before implementing the new tax system on 1st July. By end of June, brands
usually declare end of season sale. Unlike other years when the brick-and-mortar business begin
their sales by end of June, this year, the sales were declared right during the beginning of June.
Offers counting buy 2 get 2, smooth discounts of 40 to 50 percent, and there are lot more discounts
on clothing, footwear, etc. from brands like Nike, Adidas, Levi’s, etc. There is no clue about when
these propositions will get over, chances are that these offers will change after GST
implementation on 1st July.

Offers announced by Adidas - When you purchase 3 or more items, you can enjoy up to 50
percent offer on Adidas products. Shoes as well as clothes are comprised under the offer. Based
on the product selected, the company offers up to 40% discount. Adidas sales were kick-stared
during the starting of June.

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Impact of GST on Sports Industry

The GST was introduced in India in 2017. The GST program has had an impact on various
industries that have contributed to our country's economic growth. The sports industry has seen a
number of changes with the use of the GST system. Ticket prices have gone up for various
sporting events. This new tax system has contributed to the cost of sports equipment and other
sports facilities. Therefore, pricing and sports equipment are more expensive with the use of new
GST prices. Sports officials and sports industry entrepreneurs are delighted with the existing
GST returns placed on sports equipment.

Punjab is the largest and most important manufacturer of sportswear in the country. Punjab is
also an important supplier of sports goods. The industry in Punjab was important after 1947
when most of the talented workers from Sialkot (Pakistan) to live in Jalandhar. So Jalandhar is
still the chief of the sporting goods industry center. Wood is available in Kashmir and high-
quality goods are produced.

Jalandhar is the second largest urban city in India. The main reason for this is rapid growth of the
industrial sector in the region. Jalandhar is famous for the production of sportswear, hand leather
and leather tools and products. But the size of this paper is limited to sports goods. Sports
production of goods at the industrial level began on a small scale after independence. Since then,
the industry has shown us that amazing growth and now Jalandhar sports goods have been
exported. Jalandhar has a lot more than 100 large factories and 20,000 smaller units. The
production of sports equipment involves spraying balls, badminton rackets and shuttle bumps,
cricket bats and balls, different types of gloves and other protective equipment.

Sports Industry –

In 1994-95 Punjab produced sporting goods worth Rs. 9, 68,657 thousand. There is a great
demand for goods produced in this sector nationally and internationally. There are 758 registered
units with the regional industrial center. Basti Nau, Basti Danish Mandan, Basti Sheikh and

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Bargo Camp. Places for Jalandhar is important in the production of sports
equipment. All sports equipment is produced here. In 2012-13 the production of sports
equipment costs Rs. 5,920.42 lakh and directs the recruitment of staff of about 10,000 employees
and indirect employment of 40,000 employees.

Impact-

As the GST system is being distributed by the Indian government, there are price changes for
various products. The GST government has increased prices as the GST tax rate of 28% is set for
the price of sports event tickets. A recent sporting event such as the Indian Premier League has
introduced cultural

clubs in sports. This sporting event is a great entertainment for people all over the world. This
brings in high revenue for the sports industry. Sports events organized by the IPL fall within the
GST tax rate of 28%. A sporting event hosted by sports organizations such as the Indian Cricket
Board and the Hockey Federation attracts 18% GST levels.

There is a GST release for a sports event ticket priced at less than Rs. 250. But there will be only
a limited number of seats available in this price band at most stadiums.

There has been a recent GST price review for sports event tickets. Therefore, the GST rate of
28% was reduced to 18%. This has helped to lower the prices of popular sports events such as
one-day cricket matches, Test matches organized by the BCCI and other Indian sports bodies.

So, in the GST state, a sports event ticket cost more than Rs. 250 may attract a certain GST
rating.

Good and Service Tax was replaced by the Indirect taxation scheme, which was previously used.
This tax is set according to the concept of one nation having one tax. The GST regime is
expected to create serious consequences for various sectors of the country.

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With the indirect tax scheme, sports equipment and other equipment were less than 2% tax. With
the new GST tax regime, sporting and accessories prices have risen as GST slabs have been
increased to 12% to 28%. This is bad news for sportsmen who can afford expensive sports
equipment. This will have a negative impact on the growth of the sports industry. GST's new
standards for sports equipment have created controversy over Government policies. The
government has come up with programs to promote sport in schools and colleges, but the same
government has introduced new GST standards for sports equipment.

Therefore, the GST regime introduced by the government will have an impact on both external
and internal games. The new GST tax schemes have made indoor sports equipment and sports
equipment more expensive. Sports professionals from all over the country want the government
to take some steps to make sports products cheaper. Tax breaks are expected on sports equipment
and other related accessories. This will help promote sport in our country and will provide
sports-related services at a lower cost.

The above information about the impact of GST on sports event ticket prices and sports
equipment.

Indoor sporting events favor the Indian Premier League (IPL) and Pro Kabaddi League (PKL)
have recently become more expensive after GST came into force, with 28% higher tax rates.
Sports events hosted by sport’s governing bodies such as the Board of Control for Cricket in
India (BCCI), Badminton Association

of India, Hockey India and the National Sports Federations (NSF) will be taxed on their tickets at
a lower rate of 18%. [5] There is a break for tickets less than Rs.250 released on GST, but only a
very limited number of tickets sold at this price range.

Sports facilities will fall below the 12% -28% tax rate, which is the largest increase from the
previous bracket of 5%. There are also very different ideas on how to classify some of these
assets. Essential sports, health and fitness services, gyms, shoes and ankle weights, all listed as
luxury goods, attracting 28% tax.

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Goods and Services Tax is a standard tax system that applies to all taxpayers
nationwide. Therefore, all existing taxes on entertainment services have been cut off by GST
now.

The GST rate varies between 18% and 28% depending on the type of entertainment service and /
or products. See the following below.

Less than 18% GST

Circus, TV and DTH services, theater and traditional dance (including drama and folk dance) fall
into this category of taxes.

Less than 28% GST

Tickets for movies, casinos, races, movie festivals and events, amusement parks, and any
sporting event will be charged at this rate.

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ISSUES AND CONCERN IN SPORTS INDUSTRY

After the implication of GST, the manufacturing of sports activities items is concentrated in a
few places in India and turned into historically a labor extensive industry serving India in
addition to other international locations. The Government had granted exemption from excise
to sports items, which was withdrawn in 2011 to convey them in step with those via nation
Governments to pave manner for the Goods and Services Tax (GST). Duty turned into expanded
from 1 % to 2% within the following 12 months and the enterprise wanted it to be rolled
returned.

In global tournaments such as the Cricket World Cup, sports bodies are frequently observed
struggling to get exceptions for the game, clinical, broadcast and other workplace system. The
Government regularly lets in responsibility-free imports for mega occasions on some situations.
But common delays frequently keep organizers on tenterhooks. A simple gadget may also assist
the Government and organizers to deal with such issues.

The GST implementation charged nearly the entirety. After GST, the sports activities region
which was out of provider tax came into the ambit of tax roof. This sector now 18% GST and it
has tumble-down on the very foundation in which the sector simply rooted to teach.

This 18% GST tax has distracted the colleges and coaching facilities imparting sports activities
education. Under GST, they may be no longer capable of get Input tax credit.

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Place of supply of goods of adidas and decathlon (within India) –

There are different conditions for different transactions to major place of supply of good under
GST Act (section 10 of IGST Act)

• SEC (1) (a)when the exchanges/supply includes development of products, at that point spot
of supply will be Where development of merchandise ends for conveyance of beneficiary. For
instance - Adidas showroom of Punjab supplies products to Honey of Delhi then POS is Delhi.

• SEC 10(1)(b) Bill-to-Ship-to Transaction: – When products are conveyed by provider to

beneficiary or some other individual on bearing of third individual, regardless of whether going
about as a specialist or something else, at that point spot of supply Principal Place of Business of
Such Third individual. For instance If Mr. X of Haryana educate Mr. Y of MP to send merchandise
to Mr. Z of Delhi, the POS is Haryana (Mr. X's Location)

• SEC 10(1)(c) Where supply doesn't include development of products. (Thumb rule), then
the inventory Location of such merchandise at the hour of conveyance of beneficiary. For instance,
If Kailash purchases pre-outfitted office from Kashi, at that point POS for such pre-introduced
furniture and apparatus is that office.

• SEC 10(1)(d) Where products are amassed or introduced at site, Then the inventory Place
of Such establishment or gathering happens. For instance, Zenia of Maharashtra offers agreement
to Zeeshan of Andra Pradesh to introduce merchandise at Kerala; at that point POS is Kerala.

• SEC 10(1)(e) Where the merchandise are provided on Board a transport including vessel,
airplane, train or engine vehicle, Then the spot of supply Location where such products are
accepted. For instance, Amitabh accepts merchandise in Assam-Gujrat train to sell them in train
venture, at that point POS is Assam where products are accepted and not the spots where he really
sold them

• SEC10(2) Where POS of merchandise can't be resolved, at that point the spot of supply
POS will be resolved in a way as might be recommended. For instance as might be endorsed
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Place of supply of goods of adidas and decathlon (outside India) - there are
different conditions for different transactions to major place of supply of good under GST Act (section 11
of IGST Act)

• SEC 11(a) Import, Then the spot of supply Location of Importer. For instance S (India) imported
merchandise from China, POS is India

• SEC 11(b) Export, Then the spot of supply Place (Country) where merchandise are traded. For
instance P (India) traded merchandise to T (Pakistan), POS is Pakistan

Adidas

Germany, - Adidas expects production network issues to hit deals development in the principal
half of the year, especially in North America, however wants to see off a test from Nike in Europe
and re-visitation of development in the locale. Offers in the German athletic apparel brand, up 22
percent in the most recent year, were demonstrated down 2.5 percent in early exchange. Nike has
been recovering ground, helped by a constant flow of new item dispatches and a solid appearing
by Nike-supported groups at the soccer World Cup, following quite a while when Adidas ate into
its home market of North America

Adidas said currency-neutral sales growth would slow to between 5 and 8 percent in 2019, from 8
percent in 2018, with supply issues accounting for a 1-2 percent fall as it struggles to meet strong
demand for mid-priced apparel.

In contrast, Nike has forecast sales growth for 2019 approaching low double digits and German
rival Puma a currency-adjusted 10 percent.

"It is an interest issue," Chief Executive Kasper Rorsted told CNBC, taking note of that Adidas
had multiplied the size of its business in North America over the most recent three years.

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Adidas produces 457 bits of clothing a year, sourcing the vast majority of them
from Cambodia, China and Vietnam. Rorsted said the deficiencies had nothing to do with U.S.
exchange strains with China.

Adidas said it should arrive at working overall revenue of between 11.3 percent and 11.5 percent
in 2019, up from 10.8 percent in 2018, with the arrival of the Reebok brand to benefit causing it
hit an objective initially set for 2020 every year early.

Final quarter deals rose by a money changed 5 percent to 5.234 billion euros ($5.91 billion), versus
normal examiner figures for 5.2 billion, while inferable net benefit came in at 108 million, versus
agreement for 88 million.

Adidas said it expected to restore development in Europe throughout 2019, determining a slight
expansion in cash unbiased incomes for the locale after a 6 percent decrease in the final quarter.

Rorsted has said that Adidas in Europe depended a lot on a transient pattern for style shoes, similar
to its retro Stan Smith and Superstar, and insufficient on games execution gear.

Adidas saw solid development in "sport propelled" styles and in preparing and running in the
quarter, yet a lofty decrease in soccer, where it profited a year sooner from deals of group pullovers
in the approach the World Cup.

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Decathlon

Realty firm Vatika has rented around 50,000 sq ft region to retail chain Decathlon in its task at
Gurugram.

Vatika has rented this space to French firm Decathlon, which is into retailing of sports
merchandise, at its undertaking 'Customer's Village INXT' in New Gurugram, Haryana.

The undertaking, which is essential for a huge municipality, will have a leasable zone of around
1.2 million sq ft.

Alok Mehta, Head Product Strategy, Vatika, said Decathlon has been pre-leased about 50,000 sq
ft area in this project to open its flagship store in New Gurugram.
The undertaking will be created in two stages with an expected expense of about Rs 600 crore, he
said.

The main stage involving around 5 lakh sq ft would be operational by mid 2022. Gotten some
information about the rental, he said it is around Rs 100 for every sq ft at present however will rise
altogether with progress in development work.

Mehta said the organization has rented 1.3 lakh sq ft region so far including to Decathlon and talks
are in progress for additional 2.2 lakh sq ft.

Joined in 1986, Vatika Group is one of the main designers in the National Capital Region and its
portfolio incorporates private, business, municipalities, inns, instruction, business focuses and
offices the executives.

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Time of supply
The exact point in time when the goods or services are considered to be delivered or deemed is known as the
time of supply. The keyword to consider here is ‘delivered’ or ‘deemed’. That means that the tax i.e. SGST
or CGST is applicable at the point where the good is delivered. That means the tax is paid exactly at the time
of supply. Suppose, there is a delivery to be done from a factory in Mumbai to a wholesale dealer located in
Bangalore. The tax for the delivery will be considered on the basis of the point in time when the dealer in
Bangalore receives the goods.

Determining the Time of Supply

According to the GST Bill, the time of supply can be determined by the following rules

The time of supply of services shall be the earlier of the following dates:
(a) If invoice is issued within the period prescribed*,
The date of issuing invoice
OR
The date of receipt of payment
-whichever is earlier
(b) If invoice is NOT issued within the period prescribed*,
The date of provision of service
OR
The date of receipt of payment
-whichever is earlier
(c) Where the provisions of clause (a) or (b) do not apply,
The date on which the recipient shows the receipt of services in his books of account
*before the provision of service, or within 30 days after the provision of service, as per invoice rules
(other than insurance or banking companies, or financial institutions).

Factories of Adidas Around the World

The business of Adidas is spread all across the world, evidently. As a result of this, the company had to set
up factories in various countries spread across different continents. Thus, we classify the factory locations
based on the continents as below:

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• Africa
Adidas has got 24 factories set up in Africa, out of which 18 are in South Africa, Lesotho and

• Swaziland, and 3 factories are in Madagascar and Mauritius. There are 2 factories in Egypt and 1 is
Tunisia.
• Asia
Asia has got the highest number of factories of Adidas than any other continent. 27% of the factories, in
Asia, are located in China, the count is 337, followed by India with 99, Indonesia with 79 and Vietnam
with 76. The rest of the countries have got factories ranging from 10 to 60.

• Australia and New Zealand

Australia has got 3 factories and New Zealand only 1. The low factory count is because of the increased
dependence on foreign imports, which led to a reduced local supply chain.
• Europe
In Europe, Germany has got the maximum number of factories, with 23. Sweden has got 9 factories and
Italy, Spain and UK has got between 10 and 20.
• The Americas
The 215 Adidas factories spread across the Americas. The United States has 71, Canada has 29 and
Mexico has 19. Brazil, the king of Adidas production in South America, has 50 factories in 2010.
Argentina has 19 factories and Chile, Colombia, Paraguay and Peru all have fewer than 5 factories.

Time of Supply based on Adidas and Decathlon

One of the retail outlets, from which Adidas and other sport goods manufactures’ sales take place is Decathlon.
So, as a matter of fact, the supply of sports gear to decathlon, involves some amount of GST to be paid. To
understand the application of the GST, let us consider a supply of Adidas products from Bangalore, Karnataka
to Mumbai, Maharashtra.

First of all, since it an intra-state transaction, so SGST and CGST, both will be charged in the invoice.

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Now suppose the factory at Bangalore, generated the invoice the moment the order was
placed from the Decathlon retailer, let the date be 15th October 2020, and the products were delivered on 30th
October 2020. Since, the earlier of the two dates is 15th October, so the SGST and CGST applicable here will
be of the State of Karnataka, since the invoice was generated in that state.

Had the invoice been generated at the time of delivery, then the tax rate would have been that of state of
Maharashtra, as the invoice had been generated there.

Also, had it been the case that Decathlon made an advanced payment and promised to pay the rest on the
delivery of the goods, then in that case there would be no GST applicable on the payment made in advance.
The GST in advance is payable only at the time of generation of the invoice.

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ISSUE RELATED TO COMPLAINCE

India had taken a monster jump towards another request in its tax assessment history on 1 July,
2017. The principal year was brimming with questions and situations. Multifaceted nature was
additionally added by various notices and booklets, which can't generally be followed by the
majority. All the means so far taken by the public authority in making the merchandise and
enterprises charge (GST) easier are welcome. However, there is as yet far to go and the GST law
is yet to be made less complex.

As on date, merchants, citizens and assessment professionals are confronting issues with the
multifaceted nature of GST.

In the event that this law is made less complex and easy to understand, it will be the change of the
decade and will help our economy.

The new GST enrollment edge limit is a joke. On the off chance that one needs to supply
merchandise or administrations of even one rupee to any focal or state government, at that point
GST enrollment is obligatory. This makes as far as possible silly.

GST infers extra operational expenses for private companies. In an agricultural nation like our
own, not all little and medium ventures (SMEs) will have the option to bear the cost of the expense
of PCs and bookkeepers needed to agree to GST.

It is too hard to even consider assigning most extreme retail value (MRP) to carefully assembled
items, for example, neighborhood shoes and Banarasi saris.

Most little craftsmans are uneducated and, accordingly, can't compose MRP on their items or
potentially do any administrative work. Private companies with low turnover and outside GST face
trust issues.

Purchasers request solicitations from even those dealers who are excluded from GST. Without
evidence of authentication of GST exclusion, little retailers end up abandoned and stationary.

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A disentangled structure plot has been given up to a turnover of ₹1.5 crore. Be that as it may, it
victimizes provider of administrations other than cafés as it has not been made pertinent to them.
The Indian economy is significantly determined by SMEs. It will be uncalled for to expect little
scope business firms to make the change to an online IT stage and anticipate no blunders
consequently documenting. It is a tough errand for most of our working populace, which has little
active involvement in IT arrangements. The expense of its arrangement is additionally a significant
worry for MSMEs (miniature, little and medium endeavors). The public authority is hoping to
support incomes to the tune of ₹1 trillion every month. It is fascinating to check whether harsh
measures are taken against charge dodgers and firms associated with exploitative.

The current type of GST seems to convey minimal on guarantees. It appears to be the change was
turned out with almost no schoolwork both at operational and specialized finishes.

The GST Council needs to observe that a strategy should be intended to lessen the consistence
trouble on the citizens. Consistence systems should incorporate mandatory instruction and help
projects and danger-based review programs. It should likewise run an interchanges crusade that
illuminates organizations, purchasers and significant mediators of the different impacts, just as the
advantages of GST

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CONCLUSION

India is one of the world's fastest growing major economies, where the sports industry plays a
significant role in boosting the economy. This market also produced (INR 64 billion) jobs in 2016.
GST has both beneficial and detrimental effects on the sports industry through its nature. India's
sports sector is extremely labor intensive and is inherently export-oriented. The industry's total
exports account for about 0.5 percent of total exports. In fact, exports from the industry (except
sports clothing) registered a solid growth of 8.8 percent in FY17, while total exports from India
increased by just 5.3 percent. However, sports apparel, which accounts for 38 percent of total sport
exports, contracted by 3 percent during the said period. This negative growth is due to the higher
prices of cotton in India, which has affected the competitiveness of the industry. As of today, this
sector is largely dominated by unorganized players and the scale of the domestic market is
therefore difficult to enter. This will change after the GST is introduced, as unorganized businesses
would be forced to organize in order to stay in business. Any deviation will affect the ITC chain
as per the value development map under the new tax regime, which will in turn be detrimental to
the low-capital enterprises of the sector. Therefore, SMERA claims that the new tax system, if
successfully enforced and complied with would greatly allow the sports industry to be known as
an independent industrial field. However at least in the short term, raising the GST rate on certain
sporting merchandise and sports watching (luxury tickets) would have a negative impact. India, as
the fastest growing global economy, is heading towards an all-encompassing culture of sports.
People also show interest in other sports in cricket and this has spawned many categories; as a
result, demand for kits, specialist clothes, as well as related equipment and media is expected to
grow strongly.

22
 IBS Hyderabad
Academic Year – 2020-22

References –
• https://taxguru.in/category/goods-and-service-tax/
• https://retail.economictimes.indiatimes.com/news/apparel-
fashion/sportswear/adidas-says-supply-chain-problems-to-rein-in-sales-
growth/68390129
• https://retail.economictimes.indiatimes.com/news/apparel-
fashion/sportswear/vatika-leases-50k-sq-ft-to-decathlon-in-gurugram-retail-
project/74367225
• http://axguru.in/goods-and-service-tax/place-supply-gst-summarized.html
• https://cleartax.in/s/time-supply-goods-
gst#:~:text=Point%20of%20taxation%20means%20the,dates%20for%20payment
%20of%20taxes.
• https://www.jusdicere.in/impact-of-gst-on-sports-and-media-industries/
• https://b2b.decathlon.in/c/3-terms-and-conditions-of-use
• https://cleartax.in/s/time-place-and-value-of-supply-in-gst
• https://cleartax.in/s/time-supply-services-
gst#:~:text=Point%20of%20taxation%20means%20the,dates%20for%20payment
%20of%20taxes
• https://www.livemint.com/politics/policy/gst-reform-needs-to-reduce-the-
compliance-burden-on-taxpayers-1548180962836.html
• https://www.jusdicere.in/impact-of-gst-on-sports-and-media-industries/
• https://b2b.decathlon.in/c/3-terms-and-conditions-of-use

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