When I saw the news early this week that Rangers were to enter administration I felt a little sorrow, well for the supports. As someone whose club has also been in administration and a fall from grace from the Premier League to the lowly leagues I feel their pain. I also feel for the lower employees of Rangers and those which rely on the club for trade, these people will be the ones to lose out, mainly with their jobs. The footballers, managers and owners will all be fine after all they are the ones who can afford safeguards when the worst happens.
So what does this mean for football in the UK? Well apparently bad news really, tax probes have been launched into eight top English football clubs which means so could go the same way as Rangers, the question is which clubs?
Rangers are in this situation because of an alleged £9million owed to HM Revenue & Customs, unfortunately for them it doesn’t look like they have the same lawyers as Harry Redknapp nor have they wined and dined HMRC like Vodafone did. Currently HMRC are looking into the use of a tax avoidance device, Employment Benefit Trusts which could leave Rangers with a bill of more than £70million.
For those not in the know Employment Benefit Trusts (EBTs) allow foreign players to have their wages paid into a trust, they then can withdraw the money from the trust when they are no longer living in Britain. Thus avoiding paying the top 50 per cent rate of UK tax, nice!
HMRC however have deemed EBTs to be illegal and they claim Rangers’ previous owners used the trusts to avoid paying millions of pounds in tax and National Insurance on the player payroll and now they want what they are owed.
Rangers have now been deducted ten points which leaves them fourteen behind leaders Celtic; luckily for Rangers the Scottish Premier League is not as competitive as the Premier League and a loss of so many points won’t see them relegated (mores the shame).
I just wonder which teams in the Premier League find themselves in a similar situation in the future, the big money clubs should be okay, should they find themselves with a large tax bill, the smaller ones however may not fare the same, I just hope all the tax bill at Leeds are paid couldn’t face any more bad news really plus it’s not like we have any players we can sell for any kind of money!