From Ronaldo to Lukaku and Pogba: champions return to Italy thanks to the laws

combo, conte, lukaku, 2018/19
11 June at 14:00
We all know that Serie A was like heaven for all the best players in the world during the 80s and the 90s and the beginning of the 21st century. From Maradona to Van Basten, from Platini to Shevchenko, Zico, Kakà and dozens of other names, every player who wanted to show his greatness and to be considered as a champion, couldn’t help spending some years of his career in Italy.

But then, something changed: in the years after, Italy started losing appeal for the big stars of world football, for the ones named with the new trendy (and misused) term as top players: they started to look at England and Spain as the new Promised Lands, or to the Qatari colony of PSG in France. A matter of football level? No, a matter of money. Less poetic, of course, but more realistic and pragmatic.

Money from TV rights, sponsorships and taxation have overturned the rank of investment potential for the great European championships, lowing Italy down in the virtual rankings. The top Serie A teams no longer had enough economic power to compete in the market with the big foreign clubs and they had to settle for watching the best players in the world only as opponents in the European Cups. Or just on TV.

Something has started changing in 2018, with the arrival of Cristiano Ronaldo at Juventus. President of La Liga, Tebas, explained in an interview given to AS what was the key for the Italian club to convince the Ballon d’Or winner to join them, instead of remaining at Real Madrid:

“I think that fiscally it favours him to go to Italy. Here, in Spain, we have a problem with fiscal competition. Out of the biggest leagues, Spain is where the players have the worst tax situation. It's not that elsewhere the rate is so much lower, but when you're earning significant sums then these little differences in rates translate to a lot of money for the players”.

But why was it so convenient for Ronaldo to come to Italy, in a championship still below the Premier and Liga levels? The Italian economic newspaper Il Sole 24 Ore has explained well the advantages for the Portuguese star:

“For Cristiano Ronaldo, as well as a formidable football transfer, the move to Juventus is also a colossal operation of tax advantage. New residents can in fact exercise the option for substitute tax, pursuant to Article 24-bis of the Tuir, in order to pay "only" the flat rate of 100 thousand Euros with reference to all their foreign source income (for a maximum of 15 years). Evidently, Ronaldo will be able to take advantage of this regime in relation to the incomes that will accrue on his (it is presumed) already very large heritage existing abroad before his transfer to Turin”.

The Italian laws are playing a crucial role in the new attractiveness of our domestic league. Antonio Conte, who has chosen to come back as Inter manager, will benefit from the advantages of the Decreto Crescita (growth decree). From January 2020, indeed, a decree will come into force allow those who return to our country to be able to enjoy reduced taxation.

In the text of the decree there’s written that whoever transfers residence in Italy after having been out for at least two years and undertakes to reside in our country for at least two years, pays taxes on 30 percent of income. And just 10 percent if the residence is in one of the southern regions. The same tax facilities could be exploited by Juventus to take back Paul Pogba, in a deal that could really become real in these weeks.

And in the same Decreto Crescita, there is another measure that can favour the sensational arrival of Romelu Lukaku to Napoli. This provision grants tax breaks to the Italian companies that hire employees from abroad and, in particular, to those in Southern Italy, who will save even more in hiring foreign workers, paying just 10 percent on the salary of the player. Lukaku asks for a net salary of 10 million that, calculating the 10 percent taxation, would be equivalent to a gross wage of 11 million euros: a chance for the Partenopei.

Howerer, things can change again: the Italian Government has presented a new amendment to the same decree reducing the bonus. Every club will pay the tax for the 50% of their income (and not the 30%), without the  advantage of 10% for the Southern Italy. Let's see.

Emanuele Giulianelli, @EmaGiulianelli

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