The Beckham Law: Barcelona’s enduring financial appeal to football players

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Since the start of the current transfer season, we’ve seen a number of Chelsea-linked players (appear) to indicate a preference for Barcelona, ​​despite the reported unrest at that establishment and their great difficulty in spending money. and recruit players. The most notorious example of this is Raphinha, who blocked negotiations with Chelsea in order to give Barcelona time to prepare some dough to push through his transfer. Jules Koundé could do the same.

Why do players, at least allegedly, prefer a transfer to Spain rather than England? The obvious answers might be the weather, the food, the culture and the history of Barcelona, ​​but I think the answer could actually be much cruder than that: TAXES.

Gamers, ultimately, are workers like the rest of us and are subject to paying taxes to their respective governments. Everyone is motivated to retain as much income as possible, through legitimate (or illegitimate) means. The impact of tax legislation determines the decision of many individuals whether or not to move to a city. You see this factor in the decision-making of NFL players when choosing their contract. Teams that play in US states with no income tax (Florida, Texas, Tennessee, Washington, and Nevada) have an advantage in courting players who want to save more on their earnings.

So why Spain rather than England? According Balcells Group and Delcanto Rooms (private immigration law firms), the “Beckham Law” is a special tax regime that allows foreigners to pay significantly less tax than Spanish residents. Foreigners traveling to Spain may pay a flat tax of 24% on a maximum of 600,000 euros instead of the progressive tax rates applicable to Spanish residents. If taxed as a resident, the expatriate would be subject to a progressive tax rate of up to 43% depending on their level of worldwide income. The motivation for the tax benefit was allegedly to attract talent and skilled workers to Spain. It takes its name from the fact that David Beckham was the first to enjoy it. The tax relief is good for 6 years (easily within the time limit of any player at any club).

Photo by Dusko Despotovic/Corbis via Getty Images

So what is the tax situation in the UK where our beloved Blues play? According PayFit, The 20% tax rate is referred to as the “basic rate” and employees earning up to £50,270 a year are taxed at this rate. Money earned above this amount is taxed at 40% (called the “top rate”). There is a third tax bracket, called the “additional rate”. Any income over £150,000 is taxed at 45%.

Payfit provides an example to flesh out what this means: a weekly salary of £60,000 works out to just over £3.12m a year. Anyone earning this amount of money would not be entitled to a personal allowance. Of the £3.12 million annual salary, £37,700 would be taxed at 20% and £112,300 would be taxed at 40%. The remaining £2.97m would be taxed at 45%.

Spain’s appeal can include wonderful cuisine, culture, history and people, but I think one of the main reasons gamers have eyes for Spain has more to do with what they can keep in their pockets. Otherwise, if they want to win trophies, they know they don’t have to look any further than SW6!

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Photo by PAUL ELLIS/AFP via Getty Images


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