Football clubs owe state €33 million in taxes

Nineteen football clubs collectively owe the state some €33 million in taxes, and their repayment conduct does not bode well for the future, the Audit Office has said.

The auditor-general’s office documented the tax arrears of the 19 football clubs/companies enrolled in a repayment scheme via instalments.

According to Marios Petrides, spokesman for the Audit Office, the clubs in question had failed to settle their debts by the set deadline – they broke the law. This was under a repayment schedule drawn up in 2021.

But instead of facing legal consequences, the clubs got another break in May of 2023 when the cabinet decided to promulgate a new tax arrears repayment scheme. In the revised scheme, however, the repayment period was reduced from 180 months to 168 months – or 14 years.

Enrolment into the new repayment scheme came with strings attached. A major condition was that the football clubs would not accumulate new debts. For instance, if a club owed €1 million – to be repaid in instalments of €10,000 – but then in the meantime accumulated new debts, it would get kicked out of the scheme.

In tracking the course of debt repayments by the clubs, the Audit Office sought and obtained data from tax authorities. It turned out that of the 19 clubs, five had not paid a single instalment. In addition, 14 clubs had accumulated new debts.

“From the very first year of implementation of the scheme we have seen inconsistency on the part of the clubs,” Petrides told the media.

“The finance ministry has not remarked on the matter. As for us [the Audit Office] we have no executive power to impose fines. We have the data, so does the finance ministry, and they need to take a position.”

Altogether, the 19 clubs owe the state €33.2 million in taxes. The repayment deadline is 14 years – by June 2037.

“We harbour serious concerns as to whether this [repayment] scheme will achieve its objective,” commented Petrides.