Introduced in 2005, the ‘Beckham law’ gained its nickname after footballer David Beckham became one of the first to take advantage of the special tax regime which allows wealthy expats moving to Spain to qualify as a non-resident for the first five years.
As a result, foreigners only pay tax on their Spanish income and assets and can exclude their worldwide income and assets.
Ironically, in 2015 professional footballers were excluded from the scheme, which applies a flat rate of income tax of 24% on earnings under €600,000 (£529,158, $672,474) and 45% on anything above that.
‘Fishbowl lacking oxygen’
Speaking to local media at a football conference, Real Madrid general director Jose Angel Sanchez called on Spain to restore the ‘Beckham law’ for foreign football players, in a bid to keep La Liga competitive when recruiting players from abroad.
“There is concern about the competition with the Premier League which is better managed and has a bigger audience. There, footballers look for more money and pay less taxes. It is almost like a fishbowl lacking oxygen.”
“How do you explain that the only professionals for whom the ‘Beckham Law’ doesn’t apply in Spain are football players?
“I’m not saying that they should pay less, they pay everything that they have to pay, but maybe it is something that can be improved,” he said.
Ronaldo tax fraud
Sanchez’s comments come just weeks after reports Real Madrid star Cristiano Ronaldo is facing possible tax fraud charges in Spain over allegedly defrauding the state coffers out of €15m (£13m, $17m) between 2001 and 2014 linked to money earned from the use of his image.
High-profile scandals
Spanish tax authorities have taken a harder line on foreign footballers who fail to pay tax on their worldwide income, especially related to the sale of image rights, as seen in the widely-covered cases of Argentinian footballer Lionel Messi and Arsenal striker Alexis Sanchez.
Last month, Spain’s tax office, known as the Hacienda, announced that Colombian footballer Radamel Falcao faces trial for allegedly defrauding the Treasury of €5.5m (£4.7m, $6.2m).
He is accused of setting up shell companies in the British Virgin Islands to hide income from image rights while he was living in Madrid.
Earlier this year, Arsenal striker Alexis Sanchez had his Spanish villa seized by authorities and reportedly faces a possible jail sentence after admitting to tax fraud in Spain of almost €1m.
Meanwhile, Barcelona star Lionel Messi and his father were sentenced to 21-months in jail last July for defrauding Spanish tax authorities of €4.1m between 2007 and 2009.
The conviction was upheld last month by the Spanish high court after Messi launched an appeal to have it quashed.
Neither spent any time behind bars as, under Spanish law, prison sentences under two years can be served on probation.
