Pakistan has approved a tax exemption for the ICC Champions Trophy 2025, ensuring smooth financial operations for the much-anticipated cricket tournament. This move aligns with the International Cricket Council’s (ICC) standard hosting agreements, which require host nations to provide such exemptions.
The ICC Champions Trophy 2025 will primarily take place in Pakistan, with select matches being played in Dubai due to India’s decision not to travel to Pakistan. Given the tournament’s scale, Pakistan sought approval from the International Monetary Fund (IMF) before finalizing the exemption. Reports indicate that the IMF has granted consent, allowing the tax-free policy to proceed.
Pakistan was awarded hosting rights for the tournament on November 16, 2021, marking a significant milestone as the country prepares to host its first global cricket event since the 2009 attack on the Sri Lankan team. The last major international tournament held in Pakistan was the 1996 Cricket World Cup, co-hosted with India and Sri Lanka. The Champions Trophy, an elite One Day International (ODI) event held every four years, is set to bring international cricket back to Pakistan on a grand scale.
According to the hosting agreement between Pakistan and the ICC, all revenues generated by the ICC Business Corporation (IBC), ICC, its subsidiaries, member boards, players, match officials, and related entities will be exempt from income tax. However, this relief does not extend to Pakistani residents, including the Pakistan Cricket Board (PCB), local businesses, and service providers linked to the tournament. Additionally, sales tax and federal excise duty (FED) will still apply.
To implement this exemption, Pakistan’s Revenue Division has proposed an amendment to the Income Tax Ordinance, 2001, introducing clause (98AA) to the Second Schedule. This amendment, approved by the Economic Coordination Committee (ECC), empowers the Federal Board of Revenue (FBR) to issue a Statutory Regulatory Order (SRO), officially exempting the ICC’s income from taxation related to the tournament.
The PCB had previously assured the ICC of this tax relief when securing hosting rights, following a precedent set in 2008 when Pakistan was initially scheduled to host the Champions Trophy before it was relocated due to security concerns. Such tax exemptions are common in global sporting events, with nations like Australia having provided similar relief for the ICC T20 World Cup 2020.
Authorities emphasize that this exemption should not be seen as a financial loss, as failure to grant it could have jeopardized Pakistan’s ability to host the tournament. With this tax relief now secured, Pakistan is ready to welcome international teams, players, and officials, reinforcing its position as a key cricketing destination.
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