Any hopes of Formula 1 returning to India have been killed off – for the foreseeable future – thanks to a ruling by the Supreme Court of India.
The country hosted the Formula 1 World Championship on a five-year contract from 2011 at the purposebuilt Buddh International Circuit in Noida, southeast of New Delhi. The event was dropped after just three years and has not returned to the calendar.
Each year, teams and attending media faced inordinate hurdles, bureaucratic checks and taxation claims just to be able to attend the event. The event’s promoters were also under pressure from the local Uttar Pradesh state government, which demanded that the the entertainment tax exemption that the Indian Grand Prix organisers, Jaypee Sports International, had negotiated be revoked.
The tax bill that Jaypee Sports would be liable for was well in excess of $US5 million, and the sport’s commercial rights holders felt that this was too big a risk to continue with the event beyond 2013 and mutually agreed with Jaypee Sports to walk away from the contract with two years to go.
It would seem that the Uttar Pradesh government has finally got its wish, with the courts ruling that Formula One World Championship Ltd had a permanent establishment for its business in India and therefore income accruing from the Grands Prix and associated events is taxable.
The ruling will all but kill any slim hopes that Indian fans might be able to have a race on their home soil, with the ongoing bureaucracy making the event’s future completely untenable. The country’s growing fanbase will have to wait for the bureaucrats to evolve into a modern-day approach, and that is likely to take a very long time.
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