by FIFA has been heavily criticized for negotiating an eight-and-a-half-year tax exemption for the 2023 Women’s World Cup after Australia’s players ended up paying 32.5% of their income from match fees to the country’s tax office (ATO).
Football’s world governing body is exempt from paying tax on any income in or from Australia from 1 July 2020 to 31 December 2028 but, as the Guardian revealed last month, players from some countries had to pay almost a third to pay their match fee income to the ATO. This was in stark contrast to the co-hosts of New Zealand, whose Department of Inland Revenue exempts Fifa and the players from all taxes.
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Kathryn Gill, a former Matildas player and co-chief executive of Professional Footballers Australia, was surprised and disappointed to learn that FIFA had negotiated a tax exemption for itself but not the players.
“While taxation law is complex, the principle of equal and just remuneration is not,” she told the Guardian.
“Given that FIFA was able to negotiate withholding tax exemptions with the Australian government to their advantage, it is very surprising that this was not extended to those who helped generate the tournament’s revenue.
“In taking this approach, the players were left to bear the burden, unlike Fifa who sought to be the beneficiaries. Our starting point for player remuneration at the Women’s World Cup is that the prize money should be equalized back in 2019. This would resolve many of the player pay issues that emerged before and after this tournament, and ensured that the players received their wages that recognized and rewarded them for their central role in the tournament.
“Instead, many players of this generation will have to wait another four years to earn the same prize money as male professionals – and that will only happen if Fifa upholds its verbal commitment.”
Nigeria was one of the countries that hit the tax rules and the Super Falcons players received $42,500 of their $60,000 match fees as a result of ATO deductions. Other teams playing all their games in Australia were subject to the same level of tax.
South African players were even worse off as they are hit with double taxation – from the South African Revenue Service (SARS) as well as the ATO. Although they played most of their games in New Zealand the ATO charged them pro rata tax for the days they spent in Australia.
“For every match played in Australia, the participating associations had to withhold the tax. SARS will also be coming [for their share] at the end of the tax year, because we didn’t withhold enough,” said Lydia Monyepao, chief executive of the South African Football Association.
FIFA and its wholly owned subsidiary FWC2023 Pty Ltd received the exemptions in the Australian Treasury Laws Amendment (Improving tax integrity and supporting business investment) Bill 2022.
In chapter two of the amendment’s explanatory memorandum, it states that “Fifa and its wholly owned subsidiary – FWC2023 Pty Ltd – received income tax and withholding tax exemptions from the Australian government, for activities related to the FIFA Women’s World Cup 2023 delivery … exemptions apply retrospectively from 1 July 2020, they are fully beneficial to the entities concerned as they ensure that no income tax is payable on specified income and also exempt certain withholding tax obligations.”
When asked by the Guardian why it protected its own revenue but failed to include the players’ match fees in the tax exemption deal, Fifa said it had sought a concession for the players but was rejected by the Australian government.
“FIFA has been in contact with the relevant parties in both host countries, including the tax authorities on all tax matters – as Fifa does with all tournament hosts – even before the hosting appointment for the 2023 Women’s World Cup, ” said a FIFA spokesperson.
“These steps include working directly with the authorities in Australia to exempt players from tax, which was ultimately not accepted. Although Fifa does not agree with the decision, but will ultimately respect it, it is consistent with other sporting events that have taken place in Australia.”
Regarding the exemptions granted to the Australian subsidiary, the world governing body said: “The local FIFA subsidiary for the competition was an entity established specifically to deliver the event in the host countries. It was an entity with higher expenditure than income, funded by Fifa.”
Asked whether Fifa had pushed for a tax exemption for the players, the Australian government said: “The Australian government has provided a range of support for the 2023 FIFA Women’s World Cup, including tax concessions in line with previous sporting events . “
