Recession behind Rangers tax probe, says football finance expert

Published on Friday 30 April 2010 23:47

RANGERS are being taken to court by HM Revenue & Customs because the Government are desperate for tax revenue to help the recovery from recession, according to a football finance expert.

The Glasgow club confirmed this week they were under investigation from HMRC over what are believed to be offshore payments made to players.

Rangers said they would defend themselves "robustly" against any claims of wrongdoing. Charles Barnett, a partner in leading accountants and business advisers PKF's Football Industry Group, yesterday warned the current crackdown was only the tip of the iceberg. What we are witnessing in football mirrors the wider economic problems that we face," he said.

"The free-spending, debt-fuelled period of 2000-2007 has been replaced with a period of falling revenues, restricted credit and the need for a higher tax take from the Government. The result is that many clubs face potentially higher debt liabilities for past tax-driven deals at a t ime when their revenues are falling."

Barnett accused players, agents and clubs of failing to appreciate the true impact of the economic crisis. "At a recent football and tax event, one agent stood up and said his players wanted 1 million net of tax each year regardless of whether the tax regime has changed," he said. "It is unrealistic for agents or players to expect clubs to foot the bill when tax bills increase.

"It wouldn't occur in any other sector so why should it happen in football?

"The reality is that many of the fans are facing wage freezes for several years and yet football players and their representatives expect nothing to have changed and incomes to rise every year."