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Viewership & Taxation Rate in European Football


Sports, in general, has become a fast-growing sector & especially football, as the world's most popular, commercialized, and mediatized sport, occupies a key position in this economy and continues to develop. This game has continued to fascinate and enchant billions of people throughout the world, driven by an increasingly broad range of grassroots participation and propelled ahead at its highest professional ranks by bankrolling owners and huge television rights deals. As a product of its charm, the fanbases of various top European clubs are immensely global. Even if a supporter lives hundreds of miles away in Asia from Europe, he or she will remain up late at night to watch their team play. Numerous high-profile club tournaments happen throughout the season; UEFA Champions League, Europa League, leagues in their respective countries, cup games, etc. but what remains constant, is their immortal desire. As a result, financial situations and prospects for clubs in Europe's “top-five” leagues have improved. Even when the entire world was affected by the COVID-pandemic, the English Premier League, made revenue of 5,450 (£m) in 2021-22. This is just a brief idea of how much money football generates. Consequently, The rights to broadcast games on television and other video devices are purchased by media firms from leagues and clubs for billions of dollars. These companies make the payment since they are aware that many millions of people will watch the games. Athletes at the highest levels compete in a variety of sports and earn millions of dollars. They have the obligation to pay their taxes to the government, just like someone who earns a regular wage. Extraordinary wages result in extraordinary tax obligations.

Taxation rate in these leagues

So after establishing that the demand for football viewership is at an ever-increasing rate, one can easily confer that players have an upper hand over clubs in some decisions as they can easily move about. The competition between clubs allows them to handpick a club in a country with a favorable regulatory framework from the player's standpoint. Clubs do not have the same freedom because they are inextricably from a particular geographic area and have to follow the tax and social security treatment of that particular country, especially when dealing with players' wages.

Article 17 of the OECD Model Tax Convention is used to determine that “the State in which the activities of a non-resident entertainer or sportsman are performed is allowed to tax the income derived from these activities.” It does place a decisive role on the place of the activity of an entertaining role. Article 115 of TFEU also deals with direct taxation like players’ wages which can be acted upon unanimously by the member states.

How does the taxation rate differ in these top leagues

There are various types of remuneration that a football player can earn, at the very basic level, there is a wage system which is paid to players as per their contract, then there are bonuses inserted into the contracts of these players, like scoring a certain amount of goals or playing a certain number of matches. Then there are various types of sponsorship deals that these players can sign, advertisement deals, image rights, etc. We’ll be talking more about the wages these players earn and what role does the country's tax policy play in that.

(a) England- the wage costs in Premier League at around 1,430 (£m) after deduction of a 45% tax on whoever earns more than £150,000. Additionally, bear in mind that, foreign sportspersons who live and work in the United Kingdom under a UK employment contract will almost certainly become UK tax residents, and their global income will be subject to UK tax. The majority of UK employment income is taxed through PAYE deductions made by their employer. HM Revenue & Customs (HMRC) suggests one of two methods calculate this UK apportionment – the Relevant Performance Days (RPD) method or the Relevant Performance and Training Days (RPTD) method. However, these have drawn criticism, even from some well-known athletes.

The resident homeless system (sometimes known as the “British RND”) is a preferential tax scheme that the UK provides for residents who are not UK citizens. Per this arrangement, taxpayers who need a “remittance base” for tax purposes are only obligated to pay UK tax when sending their income and capital gains abroad. An RND individual is still eligible for several tax benefits even if they are currently only available if you have lived in the UK for no more than 15 of the past 20 years. Also, the remittance laws might be difficult for taxpayers with offshore investment accounts or structures to manage. The athletes playing in the UK also have to encounter this problem of double taxation, but there are these ‘double-taxation agreements’ placed in your country with the UK to avoid this problem. Currently, Australia, Canada, France, Germany, Ireland, Japan, New Zealand, Netherlands, South Africa, Spain, Sweden, Switzerland, and the USA enjoy this and helps athletes from these countries by giving the taxing rights for such income to the country of source.

(b) Spain- the Primera División in Spain, which is also called La Liga, has been one of the most exciting leagues in world football, comprising some European giants like Real Madrid, FC Barcelona, and Atlético Madrid, to name some. Likewise, the viewership garnered 301,000 domestic viewers per game in the 2021-22 season. When talking about taxation, the tax rate there is also at 45% but when combined with the regional tax rate, it could go up to 52% in Catalonia. This is higher than the other European leagues, which all range from 45-48%. This is because salaries earned by them are very high in comparison to the rest of the population. They also have a generous welfare state as well as a large and expensive government bureaucracy. The tax base is too limited to pay for it, thus taxpayers are overburdened. Although, they do have an expatriate tax regime, which is regulated through Article 93 of Personal Income Tax Law, which was often referred to as the Beckham law, where new taxpayers who transfer their tax residence to Spain get preferential tax incentives. This law is a unique expat-tax system in Spain that gives foreigners who have relocated there the choice to pay tax as non-residents, meaning that their Spanish employment income is taxed at a fixed rate of 24 percent up to 600,000 euros rather than the progressive tax rates that apply to Spanish residents. The so-called "Beckham Rule" was enacted in Spain to allegedly benefit Beckham by allowing wealthy foreigners like him who lived and worked in Spain to elect to be taxed as a non-resident.

The Beckham Law can be used with several restrictions and exceptions, such as:

The foreigner must have never lived in Spain before; the foreign national must have moved to Spain to accept a job offer there; employment obligations must be fulfilled in Spain, however, if a portion of those obligations must be fulfilled outside of the country, that portion of their income cannot be more than 15% of their total income; The job must be done for a Spanish corporation or a foreign company's long-term presence in Spain; Within six months after the start of the work contract, the application must be submitted; The exemption is valid for six years altogether, beginning with the year of arrival and continuing for the subsequent five tax years; Taxes on capital gains made within the borders of Spain are set at 35%.

(c) Italy- The Italian league which is called the Serie A has always been one of the most sound leagues. When talking about the taxation rate, it is much less than the ones mentioned before. It is governed by Article 3(1) of the TUIR defines the application of these tax rates in Italy on residents as well as non-residents. The reason for a low tax rate is because a significant tax incentive regime for high net worth individuals who wish to relocate to Italy was introduced in the Italian Budget Law of 2017 & the substitute tax will be equal to €100,000 per year, regardless of the actual amount of the foreign income for the year. This particular provision is given by Article 24-bis of the TUIR. Over the last few years, the Italian legislature has made substantial changes to the tax regimes for football players. The majority of the policies are set up in such a way that foreign football players will benefit from them once they relocate to Italy. This mostly benefits football stars, who, in addition to their regular income, benefit from the Italian expatriate income tax scheme, which allows them to reduce their taxable base by 50%.


There are numerous regulatory and institutional concerns about an EU regulatory approach to professional football's tax treatment. The EU lacks explicit powers in this area, and under the current legislative framework of TFEU, Member States are free to choose their tax approach. Differences in tax rates might reflect a variety of factors, including how they are perceived and influenced. As a result, the exact tax rate for one country differs from one source to the next, which in turn benefits some clubs over others when attracting players with their wage and income model, because after-all “nothing can be said to be certain, except death and taxes”, right?

Article written by Yashovardhan Rathore, law student at Jindal Global Law School.

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