SPORTS: Top Soccer Clubs May Face Luxury Tax to Curb Talent Hoarding
published Mar 22nd 2017, 10:30 am, by Tariq Panja
European soccer’s governing body is looking again at introducing a Major League Baseball-style luxury tax as it tries to find ways of restricting the continent’s richest teams from hoarding the game’s top talent.
Action needs to be taken to stamp out competitive inequality that results from the region’s elite clubs building up rosters overflowing with the game’s best players, according to Aleksander Ceferin, the Slovenian president of European governing body UEFA.
“We do have to examine new mechanisms like luxury taxes and in particular sporting criteria like squad limitations and fair transfer rules,” Ceferin said Wednesday in a speech delivered at a soccer conference in Lisbon. “We do need to assess whether the transfer market as it operates today is the best we can do. We cannot be afraid to touch it.”
Ceferin provided few details beyond saying he wanted to make changes after being elected into office last year with the backing of several smaller nations and a vow to take on the largest clubs. In the MLB, free-spending clubs are taxed if they exceed payroll ceilings. Success in soccer usually tracks with spending on player salaries and transfer fees.
In England, billionaire-backed teams like Chelsea and Manchester City have assembled some of the largest squads in soccer, with several top players rarely taking the field. Last year, the former head of the country’s youth development program said such clubs were stunting player development. In Spain, Germany, France and Italy a handful of top clubs dominate local and regional competitions.
It’s not the first time UEFA has considered a luxury tax. Back in 2009, when teams were spending beyond their means and accruing debt in pursuit of sporting success, it also discussed introducing a tax. That failed to materialize, with leaders of the top clubs warning the governing body not to interfere with how they operate their businesses.
UEFA did introduce cost-control measures, which cut debts by limiting the amounts teams could spend in line with their revenue. While that’s worked in cutting losses, it’s led to the biggest teams becoming even more powerful in the transfer market.
“Within the transfer system, we have real possibilities to drive change,” Ceferin said.
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