[Archived] Credit Crunch To Hit Football?

[stuwilky]

Fratton Park has been more than 95% full this season, yet some punters will be able to sit in the same seat for £120 less in August - Well done to pompey for that one!!

Isnt it still pushing £600 for an adult?

[broadsword]

Soton just docked 10 points for going into administration.

Such is life for ex-Premiership sides.

[mckenny16]

Congratulations to Alistair Darling on doing his bit for English football in yesterday's Budget.

Hopefully the galactico mercenaries currently playing for ManU, Liverpool, Arsenal, Chelsea, Man City et al will resent paying 50 per cent tax and more on their earnings and leave for Italy and Spain creating a more equal competition for the rest of us.

Unfortunately, it doesn't matter to footballers, but to football clubs. A footballer's contract wage is based on net gain. Therefore the clubs will have to pay players more pre-tax to ensure that they get the same amount of money post tax.

And when you think about a club like Rovers, spending 85% of income on wages, we need to now spend more on wages to pay the taxes.

[leftfooter]

Unfortunately, it doesn't matter to footballers, but to football clubs. A footballer's contract wage is based on net gain. Therefore the clubs will have to pay players more pre-tax to ensure that they get the same amount of money post tax.

And when you think about a club like Rovers, spending 85% of income on wages, we need to now spend more on wages to pay the taxes.

Jim's too busy limping along with the Nu Labski lame ducks to appreciate such insight Mckenny.

[Wiggy]

Jim's too busy limping along with the Nu Labski lame ducks to appreciate such insight Mckenny.

Economics GCSE students have more foresight than these 70's throwbacks LF. I thought they'd all been consigned to history with Michael Foot's donkey jacket.

[Olveres]

The Premiership bubble could be about to well and truly burst. The debt ridden clubs will have a big issue as they are the ones with the highest earning players... Man Utd and Liverpool spring to mind. They now have to find more money than ever before to cover this complete bolt from the blue whilst trying to prevent their debts rising even further each year. Smaller clubs however well run will also feel this move and it is going to potentially have massive implications for football in this country. However I'm sure the smart boys will find a loophole, possibly setting up a tax haven company in say Monaco that owns the players.... let's say Man Utd Player Holdings Monaco PLC. This company then rents the players to Man Utd for a set fee, effectively the wages of the players, potentially bypassing the Government as the players are being paid by a Monaco company, not Man Utd per se. I know there will be issues relating to third party ownership but the FA won't want to see teams going bust left right and centre so will probably change the rules to suit the above scenario. If this is achievable it could potentially reduce salary bills as there'd be no PAYE/ NI to pay, potentailly saving clubs millions of pounds.

[Billy Castell]

Interesting idea there Olevres. That could set off a whole chain of legal claims a la West Ham when the 1st team tries to do something like this, which would be very drawn out and tedious. If this did come about, could we see the trust forming some sort of holding company or whatever they're called and effectively rent the players out to Rovers?

On the plus side for us, it would sort out our wage bill, but on the negative side, it might save Man Utd etc. a whole wedge of cash. If we can stay up, we may just see an advantageous position in a year or two, as things get worse. Those with debt will be squeezed more, whilst those who have a high turnover will probably be taxed. We are neither, whilst Man Utd and Liverpool are in both catagories.

I could be wrong with that last point though. There wasn't an Economics GCSE when I was at school.

[b12_simon]

The Premiership bubble could be about to well and truly burst. The debt ridden clubs will have a big issue as they are the ones with the highest earning players... Man Utd and Liverpool spring to mind. They now have to find more money than ever before to cover this complete bolt from the blue whilst trying to prevent their debts rising even further each year. Smaller clubs however well run will also feel this move and it is going to potentially have massive implications for football in this country. However I'm sure the smart boys will find a loophole, possibly setting up a tax haven company in say Monaco that owns the players.... let's say Man Utd Player Holdings Monaco PLC. This company then rents the players to Man Utd for a set fee, effectively the wages of the players, potentially bypassing the Government as the players are being paid by a Monaco company, not Man Utd per se. I know there will be issues relating to third party ownership but the FA won't want to see teams going bust left right and centre so will probably change the rules to suit the above scenario. If this is achievable it could potentially reduce salary bills as there'd be no PAYE/ NI to pay, potentailly saving clubs millions of pounds.

Unless players could manage to live 183 days abroad they'd still count as UK residents, so be eligible for UK tax.

[Hughesy]

Unless players could manage to live 183 days abroad they'd still count as UK residents, so be eligible for UK tax.

Beat me to it Simon..spot on.

They wont be getting round Uk tax laws that easy.

[Billy Castell]

We might be able to manage it. Move our training ground to Jersey, and put it under the ownership of the trust. Then our players move their too. That is if Jersey is big enough for a training ground and Diouf's latest Hummer!

[Hughesy]

Isnt it still pushing £600 for an adult?

Im not sure, but regardless of that they have knocked £120 off some tickets when quite clearly they didnt have to.

[thenodrog]

......and are currently in discussion with Zola to extend his contract.

I realise this makes the club more saleable and the assets more valueable but why tie Zola down to an improved deal ? More to the point why would Zola sign a new deal if the club is going to the dogs......

errr............ For just that reason mick. He's prob looking for danger money at the moment. Don't forget though Zola cannot manage at home in Italy.

It will be interesting to see what Rovers are doing - although some of our board members already know the answer to that!!

We'va already done it! We lead the way remember!

[67splitscreen]

Reading the minutes from the fans forum the other day. It sounded as though there is a plan A & B.

[thenodrog]

Soton just docked 10 points for going into administration.

Such is life for ex-Premiership sides.

For both their own good they should unite and become one club with Portsmouth. Hampshire Utd has a nice ring to it. Double the gate revenue and half the wage bill and running costs. Job sorted. Next.

[Blue n White Rover]

For both their own good they should unite and become one club with Portsmouth. Hampshire Utd has a nice ring to it. Double the gate revenue and half the wage bill and running costs. Job sorted. Next.

Theno and his "merging" Theory again. It will NEVER happen. When was the last time a major club in the top Divisions merged together? I can't think of any.

Fans would be against it, and it would be pointless.

Where would they place the stadium?

One week at Fratton Park and the next home game at St.Mary's?

[philipl]

The drog is the reincarnated ghost of Cap'n Bob Maxwell, the bouncing Czech!

[thenodrog]

The drog is the reincarnated ghost of Cap'n Bob Maxwell, the bouncing Czech!

Yeah like Hearts and Hibs, Oxford and Reading have threatened the status quo in their respective countries eh?

The 1st two have a religious divide but Thames Valley Royals would have been eminently sensible imo. Readings relative success recently was down to millionaire backing. Without Madjeski they'd have been wallowing in Div 1 / 2 with Oxford, and when he tires of chucking good money after bad toward ungrateful players and supporters they'll be straight back there.

Philip ...... Considering you are pompous enough to put yourself forward as the boards unofficial financial analyst you aren't half gormless about financial reallities.

[Wiggy]

I could be wrong with that last point though. There wasn't an Economics GCSE when I was at school.

Fair enough Billy, there were no GCSEs when I was at school either.....but if you need to further your education try this Very basic economics

[broadsword]

i'd rather be a king for a day than a beggar for a lifetime. Or something.

I'm not interested in being a cog in another machine, it's Blackburn Rovers or nothing at all.

[Olveres]

I'm waiting for the following:

"I have handed in a transfer request at Manchester as I wish to leave this country and its punitive tax laws, the Spanish laws are much better.

Love Cristiano."

[philipl]

Yeah like Hearts and Hibs, Oxford and Reading have threatened the status quo in their respective countries eh?

The 1st two have a religious divide but Thames Valley Royals would have been eminently sensible imo. Readings relative success recently was down to millionaire backing. Without Madjeski they'd have been wallowing in Div 1 / 2 with Oxford, and when he tires of chucking good money after bad toward ungrateful players and supporters they'll be straight back there.

Philip ...... Considering you are pompous enough to put yourself forward as the boards unofficial financial analyst you aren't half gormless about financial reallities.

Gormless enough to know that 1+1 makes less than 1 when more than half your market turns its back on the combined venture in disgust and protest at the merger!

[Ricky]

Without Madjeski they'd have been wallowing in Div 1 / 2 with Oxford

Think Oxford would see 'languishing' in Divisions 1 or 2 quite an achivement as they're currently non league!!!

[roversmum]

Fair enough Billy, there were no GCSEs when I was at school either.....but if you need to further your education try this Very basic economics

Golly (am I allowed to say that? ) I didn't realise you guys were more ancient than me .

I took GCE Economics and GCE Commerce - I know that was rather some time ago and it was a fairly new subject, but still...

[Billy Castell]

I'm 28, but my school did not do economics as far as I can remember, but did do Business Studies. And the only foreign languages were German and French. I'm sure other schools did economics, but not Wootton Upper School. It didn't do Politics and Sociology GCSEs until I was doing A-Levels. On a sort of related note, I believe there has never been a Chancellor who has had a degree in Economics.

To get back on topic, I don't think there will be that many foreign owners wanting to invest in an overseas football team. For example, China has been said to look to concentrate on its developing internal market, whilst other countries will adopt a similar attitude. The exception being Arab blokes who fancy a new toy. This would obviously mean fewer massive shirt sponsorship deals from airlines and foreign beer. There may also be a drive to give a bit more attention to domestic leagues at the expense of the Premiership too, thus also decreasing the foreign cash coming in.

I think that last paragraph has made this post on topic.

[philipl]

Just read the decision on Southampton- if they get enough points to stay up they take the ten point hit now. If they don't it is held over to next season in League one. Ouch.

As Southampton's parent company is administration, it set me thinking that West Ham's parent company is in administration as well.