2023 F1 Budget Cap

F1 Budget Cap for 2022 was set at $135 million per team for the 2023

Each team has to pass an audit, and there are regular meetings between the teams and the FIA ​​throughout the year.

Penalties are imposed when violations occur, and the penalties for each violation are obscured to avoid the temptation to attack.

Minor violations will be deemed not to exceed $5 million over the threshold, while major violations will exceed that amount.

There are exceptions to the expense cap, allowing teams to spend unlimited resources such as marketing, travel expenses, and most importantly, the wages of their top three earners.

Basically all costs related to vehicle performance are included. 

In 2022, inflation compensation and an additional $1.2 million were given for adding one more race over the originally agreed limit of 21 races. Therefore, the final cost cap for 2022 was set at $142.4 million instead of $140 million.

Inflation adjustments for 2023 have yet to be announced, but the FIA ​​announced on Tuesday that the cost cap adjustment for additional races beyond 21 has been increased from $1.2 million to $1.8 million per race. Races added to the calendar affect more expensive flyways.

The 2023 calendar will include 23 races, two more than before, so the teams will be given an additional 2 x $1.8 million = $3.6 million.

Therefore, the base cost cap for 2023 before adjusting for inflation is $135 million + $3.6 million = $138.6 million. Adjusted for inflation, that figure could approach $140 million in 2023. 

F1 wants to change the deductible expenses for teams in 2023 due to an increase in sprint racing. With the increase in events, the team will receive more than double his financial support for sprint events. 

Last season they could only deduct £123,000 ($150,000) from their year-end salary for each sprint race. A further £82,000 ($100,000) was allowed to be deducted from the cap for damage incurred during Saturday's race. 

That amount is expected to rise to £329,000 ($400,000) per event per sprint in 2023. With six sprint events scheduled for next season, teams will be able to spend a further £2m ($2.2m). This represents an increase in subsidies of £369,000 ($450,000) for three events in 2022. However, the proposed changes will not be approved until approved by the FIA's World Motor Sport Council. 

Six sprint races were scheduled for the season, but were changed at the last minute after disagreements between the teams over financial concerns. The builders wanted to add a budget cap because of the increased costs and risks involved in joining.

This comes weeks after Red Bull was hit with financial and sporting penalties for exceeding last season's F1 expense cap. The team was fined £6.4m ($7m) and had their wind tunnel and CFD testing time cut by 10%.

Red Bull was found to have exceeded that cap by £1.8m ($2.2m), but the FIA ​​allowed it to be £432,000 ($500,000) if the tax return had been filed correctly.