Home football Minister Van Peteghem meets football, Pro League proposes alternatives | Belgium

Minister Van Peteghem meets football, Pro League proposes alternatives | Belgium

by archysport

Minister of Finance Vincent Van Peteghem has revised his preliminary draft for a tax program law after the fierce criticism from the football world 2 weeks ago. Van Peteghem did the considerably curtailed tax benefit x3, but the condition remains that those cents are used for youth and infrastructure. That writes De Morgen. The Pro League responds with two simple alternatives.

The 6 top football clubs in Belgium, but also MR chairman Georges-Louis Bouchez, screamed bloody murder 2 weeks ago, when it turned out that the clubs would receive a maximum of 4 million euros discount on their taxes from 1 January.

With this tax shift, the minister wanted to make the existing and distorted tax benefits of the football clubs – which together amount to around 100 million euros per year – more equitable.

Anderlecht, Club Brugge, Standard, Gent, Genk and Antwerp declared “the sector bankrupt with a recurrent impact of up to 170 million euros”. The Pro League and the Belgian Football Association also stood on their hind legs. It is said that these tax benefits are the basis of the success of the Red Devils and the Belgian clubs in Europe. Otherwise, that’s it.

The minister listened to their complaints, just like those of other sports, but also to an impact analysis and the advice of the Council of State.

6 million euros for youth, 6 million euros for infrastructure

Currently, clubs are only required to pay 20 percent of normal taxes on player wages. With the remaining 80 percent, they can actually do whatever they want.

In his first draft, the minister imposed a tax benefit ceiling of 4 million euros per club, as a result of which the 6 top clubs would jointly lose 37 million euros per year.

In his new proposal, the minister will multiply this by 3, to 12 million euros. Only Anderlecht would – looking at the income of 2019-2020 – lose 3 million.

The stricter spending conditions will remain the same: 6 million euros must go to the youth academy, 6 million to infrastructure. “I have no problem with clubs earning money. But the money they receive from the government should serve what we think is important,” the minister said in De Morgen.

The proposal will be discussed on Friday at a second reading of the program law. Minister of Social Affairs Frank Vandenbroucke (Vooruit) is still working on a reform of the social security contributions for professional athletes.

The 2 reforms together should yield 43 million euros for the budget, 30 million are targeted through social security contributions and 13 million through other fiscal measures. Both reforms are expected to take effect on January 1.

Pro League responds with 2 easy alternatives

The Pro League quickly responded to the new proposal. The association of professional clubs in Belgium fears that the current reform plans of the tax system and the social security scheme for professional athletes will cause irreversible damage to Belgian football.

The association reiterates its acceptance of the federal government’s ambition of 43 million euros. The Pro League emphasizes that that amount makes up more than 11 percent of the annual turnover for corona.

“The manner in which and the timing of introduction (mid-season and in covid times) are subject to consultation with the cabinets,” it reads in a communiqué.

The Pro League insists on the principle that the reforms should not jeopardize the financial capacity of the clubs and should not lead to the relocation of professionals abroad.

“The Auditor General for the licenses (Nils Van Brantegem, ed.) has estimated the total impact of the minister’s new texts at at least 27 million euros. This 27 million is composed of several components: 7 to 9 million, which are no longer under discussion. exists, but In addition, an adjustment to the exemption from withholding tax on which we have a different view.”

“The new texts represent a major reform of the system. We fear that these measures could affect both small and large clubs amidships in their budgets and chances of survival.”

“It is predictable that investment in youth will decline rather than increase.”

We argue in favor of acting very cautiously in the legal field and taking the time that is necessary.

The Pro League is wary of European liability risks

The Pro League therefore concludes: “We argue for a simpler approach that is closer to the existing regulation, and only changes one element in order to achieve the budgetary target.”

The Pro League makes 2 concrete, non-cumulative proposals:
– Alternative 1: “Adjustment of the age below which no spending obligation (on youth, infrastructure, etc.) is required from 26 to 23 years. This measure has an impact of 6.5 million euros.”
– Alternative 2: “Adjustment of the percentage of exemption from payment of withholding tax from 80% to 75%. This has an impact of 7 million euros.”

The Pro League is also concerned about the legal sustainability of the ministerial proposal. The subsidy scheme for the sports sector was never notified to Europe as state aid. The idea is that if the ceiling of the tax subsidies is raised from 4 to 12 million euros, there may be a threat of recovery of that aid.

“We argue in favor of acting very cautiously in the legal field and taking the time necessary,” concludes the press release.

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