Foreign footballers draw big bucks, evade tax

NEW DELHI: In the early ''80s Iranian duo Majid Baskar and Jamshed Nassiri took Kolkata football by storm. Ever since, football clubs have signed on foreigners as the highest-paid players in the domestic football circuit.
The trend continues: This season, Mohun Bagan has signed on Igor Shkvirin from Uzbekistan as technical director and East Bengal has signed on South African physical trainer Kevin Johnson for a month.Add to this 100-odd foreign footballers already here. Cricket and golf were corporatised long ago, yet football clubs continue to give away dollar payments informally and illegally.
Says All India Football Federation president Priya Ranjan Das Munshi: "Earning in dollars and carrying the money back home should no longer be a problem in today’s liberal economic regime. One must declare it and pay taxes." But, in reality, the bulk of the money paid is in "black" — essentially, to avoid taxes, both by the players and clubs, say club officials.
Most foreigners prefer the major chunk of the payment in dollars. Since the ''amateur’ clubs, can only pay in rupees, ''indirect routing’ of the money suits them. Also, since football is not professional in India, foreign footballers can’t get a work permit. "We have asked the finance ministry to exempt footballers from tax, since their peak form lasts only for three to four years," they say.
"We pay for the players’ food, house rent, travel and kit," admitted Anjan Mitra, general secretary, Mohun Bagan club.
Clearly, a player can’t bill the club under the above heads for Rs 50 lakh in a city like Kolkata. So what does he do? He gets a subsistence amount — the major chunk of the payment is made in their home countries through "middlemen" based there. The clubs pay the equivalent amount to the middleman’s account in India.
According to a East Bengal club official, "The semi-professional structure of the clubs force us to follow this arbitrary system of payment. Each of the big clubs have at least three foreign players now, which is a real headache for the treasurers."
Das Munshi explains that there are three categories of foreign footballers. Those with student visas have no problem. Those with tourist visas, need to get them renewed. Then there are those who come on business visas.
"Since the tax liability is on the clubs they don’t show much in the books and if some amount is paid through vouchers, there is little one can do. We tried for tax exemption for footballers up to the age of 30, but the finance ministry has agreed to an exemption of up to Rs 75,000. Since the National League has a semi-professional status we have problems regarding payment," he adds. Once it acquires a professional status, like the European leagues, there will be no problems. "But that will take time," he says.