Series A: Italy’s government abolishes tax advantages for foreigners

Difficult transfer market expected

Serie A is threatened with losing a significant locational advantage on the transfer market. According to consistent media reports, the growth decree (“Decreto Crescita”) passed in 2019 will no longer be extended, as the Italian government has decided. If there is no quick rethink, international star players would no longer be able to be lured to the southern European country with tax advantages – 25 instead of 45 percent on gross salary. A short-term extension until after the winter transfer window was also rejected. The league association expressed clear criticism.

“The Lega Serie A notes with astonishment and concern the rumors circulating in the press this evening that the Council of Ministers has decided not to approve an extension of the special tax regime for athletes working abroad. Such a decision, if confirmed, will have as its sole outcome a result that is diametrically opposed to the one sought,” it said in a statement (quoted via “Calcio e Finanza“).

There have long been discussions in Italy about promoting its own youth, with voices from the right-wing spectrum often calling for the transfers of foreign players to be limited or made more difficult. The right-wing government led by Prime Minister Giorgia Meloni has now apparently decided in this spirit. The Serie A stressed: “The non-renewal, as also detailed in a letter sent to the government in recent days, will lead to a lower competitiveness of the teams, resulting in a reduction in revenue, less funding for the youth academies, less induced income and therefore results in less revenue for the state treasury.”

The top league criticized the fact that a false view had once again prevailed that “does not take into account the extraordinary economic, social and cultural role that this sector of the economy plays in Italy. Should the result of the Council of Ministers be confirmed, Serie A hopes that the Parliament will be able to correct this error, which is damaging not only to Italian football, but to the entire sport and its considerable activities.” According to “Calcio e Finanza In recent weeks it has been heard from club circles that they are hoping for a further postponement; there has even been talk of a moratorium of up to five years.

Meanwhile, the players’ association AIC, represented by President Umberto Calcagno, expressed its approval of the government’s decision: “We were very pleased to hear the news that the regulation for foreign employees contained in the Growth Decree, which disadvantaged the entire national football movement, has also been lifted for athletes became. From January 1, 2024, Italian and foreign football players will finally be able to compete at the same level; For this, I would like to thank those in the government and political forces who have shown themselves sensitive to our concerns and the fate of Italian football, in order to protect the development of our world and the future of the national team.”

Serie A: What the decision means for transfers and extensions

When the decree was introduced in 2019 by then-Prime Minister Giuseppe Conte, there was a jump in net salary costs: from 1.129 billion to 1.36 billion euros. Jatin Dietl, Area Manager Italy at Transfermarkt, explained at the time: “The former Italian government passed a law in the ‘Decreto Crescita’ that made it easier for Serie A clubs to buy abroad. This new law, made primarily to bring emigrated specialist staff back to Italy, also promises enormous tax relief for players who come from abroad. Which in the end suits the clubs. For example, Romelu Lukaku’s gross salary is significantly lower than Paulo Dybala’s, although both earn roughly the same net salary. With this ‘Legge Conte’, the (former; editor’s note) Prime Minister is not entirely uninvolved in the return of his namesake to Inter’s coaching bench and the transfers of many stars such as Lukaku, Matthijs de Ligt, Alexis Sánchez and Franck Ribéry.”

The expiry of the decree does not mean that contracts concluded in the past are then invalid or will be treated differently for tax purposes. However, if players like Olivier Giroud (37), who moved to AC Milan in 2021, or Roma coach José Mourinho do not extend their expiring contracts before the turn of the year, they would no longer benefit from a later signature. It remains to be seen whether players comparable to Benjamin Pavard, Marcus Thuram (both Inter), Lukaku and Evan Ndicka (both Roma) or Christian Pulisic (Milan), who were brought in a few months ago, will sign in Serie A in the summer of 2024 for the coming season still show.

Lazio president Claudio Lotito warned reporters that the league would be less competitive and big clubs could get into trouble: “A lot of nonsense has been decided, we’ll see what a damn mistake was made. It’s not good for the state either because it won’t get the money it could get. It’s better for a foreign player to pay taxes in Italy than for him to never come here and never pay, right? Last year we had three teams that made it to three European finals. Now I want to see what happens. The real problem is that it could destroy big clubs like Juventus, Milan and Roma.”

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