Free article section

You are reading a Free article. Apply for a subscription to access all the valuable information on the website Sports Law & Taxation

THE NETHERLANDS: In appeal: Conclusion of A-G is that professional soccer club is not an institution for the public benefit

A Netherlands Court of Appeal had decided on 13 November 2003 that the professional football club NAC (based in Breda) should for the purpose of the Netherlands inheritance tax be considered as an institution for the public benefit. Therefore the receipt of an inheritance by the club NAC was subject to inheritance tax at a flat rate 11%, instead of the much higher progressive tax rate (varying from 41 to 68%). The decision was remarkable, because in previous case law it has been decided by the Netherlands Supreme Court that amateur football clubs are not to be considered as institutions for the public benefit. The main argument for the Court of Appeal appears to be that professional football is serving the general interest of society by offering possibilities for relaxation and for spending leisure time for huge numbers of spectators from all levels of the society. The latter aspect is the main difference with amateur football clubs, which mainly serve the interests of its members. The decision may also be relevant for income tax purposes. Gifts to qualifying institutions for the public benefit are - within certain limits - deductible from the taxable income of resident individuals. The tax benefit for high-income earners may be 52%. The Netherlands tax authorities went into appeal. On 19 May 2005 the Advocate General Niessen to the Netherlands Supreme Court had concluded that in his opinion the professional soccer club does not qualify as an institution for the pubic benefit. The A-G bases his conclusion on the reasoning that sponsors, players and the spectators all have a private interest in the club. The A-G also mentioned that 60% of the income of the club is paid by sponsors, while the remainder is being funded by the spectators. The A-G follows case law of the Netherlands Supreme Court, which requires that an institution for the public benefit equally benefit the general interest and public interest of interested parties. As last argument that is mentioned by the A-G is that the intention of the legislator was to stimulate activities which serve the public interest but for which from regular sources insufficient means would become available. Professional soccer has sufficient potential for finding its own financing means. The decision of the Supreme Court is still to be awaited.
The Journal

Global Sports Law and Taxation Reports feature: articles; comparative surveys; commentaries on topical sports legal and tax issues and documentation.

The unique feature of Global Sports Law and Taxation Reports is that this Journal combines for the first time up to-date valuable and must-have information on the legal and tax aspects of sport and their interrelationships.

TheĀ Editors

The editors of  the Journal Sports Law & Taxation are Professor Ian Blackshaw and Dr Rijkele Betten, with specialist contributions from the world's leading practitioners and academics in the sports law and taxation fields.

The Editors

Managing editor
Dr. Rijkele Betten

Consulting editor
Prof. Dr. Ian S. Blackshaw

Editorial board

Prof. Guglielmo Maisto
Maisto e Associati, Milano

Dr. Dick Molenaar
All Arts Tax Advisors, Rotterdam

 

Mr. Kevin Offer
Hardwick & Morris LLP, London

Mr. Mario Tenore
Maisto e Associati, Milano

Address

Nolot BV
St. Jorisstraat 11
5211 HA  's-Hertogenosch
This email address is being protected from spambots. You need JavaScript enabled to view it.