French football bodies unite in opposition to ‘super tax’
01 Oct 2012
French football’s key stakeholders have stated the country’s new ‘super tax’ will have a “disastrous” effect on the competitiveness of the game in France.
The proposed tax has been the subject of much debate in French football circles in recent months, but was confirmed as the French socialist government unveiled its 2013 budget on Friday. A “temporary” 75% levy will be introduced on annual earnings in excess of Eur1 million and a new rate of 45% on incomes above Eur150,000. This compares to the existing rate of 40% on earnings above Eur69,505 with the government stating the levy will remain in place until the country’s debt is cleared.
The package aims to reduce the country’s deficit to 3% of national output next year from 4.5% this year, bringing in Eur30 billion for the treasury. However, French Football League (LFP) president Frederic Thiriez, Professional Clubs’ Association (UCPF) president Jean-Pierre Louvel and Association of Professional Footballers (UNFP) president Philippe Piat have warned that the changes will have a dire effect for French football. “The 75% tax on high incomes in the draft budget 2013 will have a disastrous effect on the competitiveness of French football,” they said in a joint statement. “Leaders of professional football are well aware of the effort necessary to restore public accounts. Moreover, the cumulative tax and social contribution from clubs and players reached a new record in 2010-2011 of Eur622 million.”
The statement continued: “The new tax will result in a very significant increase in the taxation of all the best players in Ligue 1, which does not take into account the specificity of their short career. Clubs that for the vast majority are unable to increase their total payroll will be deprived of many talents essential to their economic and sporting success. It would be illusory to think that the sure exodus of many players will be offset by the recruitment of other players of the same level. Therefore, already facing a labour cost much more important than its European competitors and a decline in resources due to the crisis, the entire chain of French professional football, in excess of 25,000 jobs, will undergo the very negative consequences of a thoughtless tax measure whose first effect will be to reduce the tax base.” Speaking to Reuters, UCPF chief Philippe Diallo said the new taxes would cost the clubs around Eur150 million. “The impact is significant for us in a very unfavourable period for French football, since we lost Eur131 million in 2011,” said Diallo. “In some cases it is the club who will pay the taxes of the players.”