Article published 20 March

Last week, questions were asked in the Spanish parliament about the amount of tax that was owed by Spanish clubs to the government.  The government was forced to admit that it was owed  €752m in back taxes (including 48m owed by Barcelona and 155m owed by Atletico Madrid).  The issue was quickly compounded by the Sports Minister Miguel Cardenel brazenly announcing that they were looking at ways that debt could be written-off.  The reaction from German clubs was fairly stinging: Bild's sports page on Tuesday ran with the headline "Will German taxpayers eventually have to fork out for Messi and Ronaldo?" 

On Thursday (16 March), Cardenal made a u-turn and said the football clubs' debt would no longer be wiped from the books."We are working to provide a solution to the problem. What the government can offer are policy instruments so that the clubs can cope with this situation, but neither will forgive the debt or provide more subsidies, " 

There is an interesting Financial Fair Play element to this issue. FFP rules state that a club will fail the FFP test if it is not up-to-date with its tax
payments (Article 50) - see attached extracts below. FFP rules dictate that the Spanish clubs have until 31 March to agree terms in writing with the Spanish tax authorities (if they haven't already done so).  This probably won't be an obstacle given the comments from the Sports Minister, but given the recent German focus, it will make any future decision to waive the tax liability much more difficult. 

Article 50 – No overdue payables towards employees and social/tax authorities
1 The licence applicant must prove that as at 31 March preceding the licence season it has no overdue payables (as defined in Annex VIII) towards its employees or social and tax authorities as a result of contractual and legal obligations towards its employees that arose prior to the previous 31

ANNEX VIII: Notion of ‘overdue payables’
2. Payables are not considered as overdue, within the meaning of these regulations, if the licence applicant/licensee (i.e. debtor club) is able
to prove by31 March... that:
b) it has concluded an agreement which has been accepted in writing by the creditor to extend the deadline for payment beyond the applicable deadline

See attached article from the Independent: