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French Football Clubs To Strike Over 75% Wealth Tax

posted 24 Oct 2013, 09:45 by Mpelembe Admin   [ updated 24 Oct 2013, 09:48 ]

PARIS, FRANCE (OCTOBER 24, 2013) (REUTERS) -  French soccer clubs will stage a strike at the end of next month in protest at a controversial super tax on player salaries in an escalation of a row over president Francois Hollande's tax policy.

The strike is the latest blow to Hollande, whose government is already suffering from record low popularity ratings because of high unemployment and internal bickering over everything from immigration to economic policy.

"At the end of the month (of November) there will be a historical day, a day without any matches,"Jean-Pierre Louvel, the president of the professional clubs' union, told Reuters Television on Thursday, "it is the whole of football which is at stake today and not only to protect some interests, it is about the nation's interest generally and through football which we need to preserve and for multiple reasons."

The strike, the first since French league players protested about their contracts in 1972, will affect Ligue 1 and 2 matches on Nov. 29 to Dec 2.

The first round of matches in the 2010/11 Serie A season in Italy was called off after players went on strike over the failure to agree a collective bargaining agreement between the players' union and the league.

Fourteen of the 20 Ligue 1 clubs will be affected by the tax, with Qatar-funded Paris St Germain the hardest hit while Monaco, backed by a Russian billionaire, will be exempt as they do not fall under French tax laws.

PSG, who have spent more than 200 million euros on transfers since being taken over by Qatar Sports Investments in 2011, are expected to pay some 20 million euros - just under half of the total the clubs would pay annually.

"Whether PSG (Paris Saint-Germain) is able to pay for this (the super tax) that's their business, their financial set-up is very different (from other clubs'). But in any case this represents a budget which won't be invested into football. And on top of this, what if their investors start wondering about French fiscal rules, the increase in the rates and whether it could, at some point, bring them to disengage from French football," Louvel said.

"The other club which won't be paying it (the super tax) is Monaco - and we have been saying that for a while - that Monaco has a tax privilege which puts the rest of us on an uneven footing. But these are just two clubs (PSG and Monaco). The championship has 20 clubs, and even if some want to see it reduced to 18, 16 clubs remain. Where will we find those 16 clubs which today are in deficit? And it is those clubs which tomorrow could make the whole of (French) football go bankrupt, with consequences on Ligue 2 clubs. It's the whole of the industry which will fold," Louvel added.

Four-fifths of French voters believe the Socialist Hollande will not win the next presidential election in 2017, a Harris Interactive poll for Le Figaro daily and LCP television showed on Thursday.

The 75 percent tax rate was initially to be paid by those earning over one million euros a year.

After protests by top French executives and actors such as Gerard Depardieu, the government changed the law so that it would be payable by the companies offering such salaries.

The tax is applicable to annual revenues above one million euros although there is a five percent cap of a company's turnover.

"A football club is treated like any other company," the Prime Minister's office said.

Hollande is to meet French clubs' representatives next week to discuss the tax.

The French clubs are backed by the League (LFP) in their fight against the government.


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