French soccer clubs call foul over 75% tax
Professional teams worry the proposed surcharge on the rich could cost the country some of its star athletes.
If actor Gerard Depardieu's retreat to Belgium didn't stir passions about France's forthcoming tax hike on the rich, perhaps its effect on the nation's soccer clubs will.
Paris Saint-Germain is the richest soccer club in France and has a team apparel and souvenir store along Paris' Champs Élysées. Its ownership group is based in Qatar, and its roster includes English icon David Beckham (pictured) and Swedish star Zlatan Ibrahimovic. It is also, according to Bloomberg, directly in the crosshairs of France's new tax plan that applies a 75% surcharge to salaries above 1 million euros.
After weeks of unclear answers when questioned about the tax's effect on professional sports teams, Prime Minister Jean-Marc Ayrault’s office issued a statement on Tuesday confirming that the surcharge will apply to soccer clubs including PSG. Considering that a dozen members of the PSG roster make 1 million euros or more, France's soccer authorities are, at best, unhappy.
"With these crazy labor costs, France will lose its best players, our clubs will see their competitiveness in Europe decline, and the government will lose its best taxpayers," France’s Football League said in a statement.
Soccer has been a touchy subject in France in recent years. National superstar Zinedine Zidane was ejected from the World Cup final in 2006 for head-butting Italy's Marco Materazzi in the chest and was forced to sit during the shootout that cost France the title. France's 2010 World Cup squad was riddled with infighting and is best remembered for boycotting practice and exiting the tournament early.
Now, France's soccer clubs find themselves on the wrong end of President François Hollande's campaign promise to enforce a 75% tax on the rich. A court struck down his original tax plan last December for targeting individuals instead of households. Another court rejected a revised version, saying any tax above 66% was out of the question. Last week, Hollande revived the issue by saying the 75% tax would apply only to corporations, avoiding the courts' objections but leaving it unclear where soccer clubs fell on that spectrum.
This comes at a particularly tough time for PSG, which has to play FC Barcelona and superstar Lionel Messi in Europe's Champions League quarterfinals. With coach Carlo Ancelotti facing the very real proposition of losing up to three-quarters of his 12 million euro salary to taxes, the pregame pep talk may have more to do with financial strategy than a game plan for Barcelona.
Hollande is a great example of why America needs a Conservative in the White House. But my personal belief is that Hollande is a hero to the 51% who voted for obama.
Socialism is so popular because the people voting for socialists look out for themselves in the short term. They are dooming both themselves and the rest of us in the long term. Why so blind?
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[BRIEFING.COM] Equity indices closed out the month of August on a modestly higher note. The Russell 2000 (+0.6%) and Nasdaq Composite (+0.5%) finished ahead of the S&P 500 (+0.3%), which extended its August gain to 3.8%. Blue chips lagged with the Dow Jones Industrial Average (+0.1%) spending the bulk of the session in the red.
The final week of August represented one of the quietest stretches for the stock market so far this year. The first four sessions of the week produced the ... More
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