Source: REUTERS/Teresa Kroeger
[Saba Sports News] According to British media reports, teams competing in the Club World Cup will face issues related to tax payments. Different clubs will experience varying tax rates due to differences in hosting locations. In March this year, FIFA announced a huge prize pool of 1 billion for the first Club World Cup, with the champion potentially earning up to 125.8 million. In June 2023, FIFA announced the United States as the host country for the inaugural Club World Cup. Although FIFA has secured various tax exemptions for the 2026 World Cup to be held in the U.S., due to the short preparation time for this Club World Cup, similar tax exemptions have not yet been implemented. Additionally, differences in state tax rates across the U.S. could result in losses for clubs based on their hosting location. Under the current schedule, Paris Saint-Germain may face the most severe impact as two of their group stage matches are scheduled to take place in Los Angeles. In contrast, Manchester City might benefit as their final group stage match is set to take place in Orlando, where there is no state income tax in the state of Florida. Another complex issue involves conflicts between certain U.S. state tax policies and “double taxation treaties” signed between the federal government and other countries. These treaties aim to prevent individuals or companies from being taxed twice by different jurisdictions, creating loopholes that could lead to financial setbacks for some clubs.