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Spanish football clubs told to set aside broadcast income for tax payments

Spanish football clubs will be forced to set aside 35 per cent of their broadcast rights income as a guarantee against tax obligations from the start of the 2014-15 season, under new rules agreed between the Liga de Fútbol Profesional, the Spanish league, and the country’s government.

The rules are part of new regulations to be introduced in a bid to curb irresponsible spending. Reuters reported that clubs in Spain’s top two divisions collectively owe about €750 million ($983 million) in unpaid tax, plus a further €600 million in social security payments.

“Economic control will be strict, as well as the sanctions regime,” the league said. “It’s about designing a road map which will allow a definitive change in the current landscape under which (tax) debt will be reduced over time until it no longer exists.”

The league added that clubs which transgress the rules could be barred from participating in competitions and even forced to sell players, in a process overseen by a commission comprising the league, government and officials from clubs.

Under the terms of the agreement, the government would be able to withhold state lottery funding from the league if the latter failed to enforce the rules.