Corruption is far reaching, the amount of world leaders and political figures that become embroiled in tax evasion and other forms of outwitting the public is massive, but now the shining star that is Cristiano Ronaldo is in the spotlight for the wrong reason.
Ever since the economic downturn Spain has been looking for ways to pump money into the government, one way of going about it is targeting the highly paid and seeing if they withhold more than they should. Now it should come as no surprise that big name players get big boy checks, but the image rights that they “sell” can make them even more. For example, in 2016, Lionel Messi was found guilty of tax evasion for the figure of €4.1 million, Javier Mascherano was also found guilty for failing to pay almost €1.5 million, Samuel Eto’o, Jose Mourinho, Alexis Sanchez, Neymar Jr., Diego Maradona and many more were said to holding out on Spain as well. These are big names, these are men that make many millions a year. Many of these tax disputes are about image rights which are usually signed off when a player signs a contract with a club, usually to a company or group a top agent, like Jorge Mendes, controls or to a shell company that the player or their father sets up, as was Messi’s case. These companies also tend to be off shore, or in Latin American countries where the players hail from.
Pre-2010 Spain was almost a haven for soccer stars, they lived under a Spanish Decree that became dubbed Beckham Law. From 2005 to 2010 the Beckham Law allowed rich expatriates, like soccer stars, to have a choice in whether or not they are considered Spanish tax residents, with opting out allowing them to avoid taxes on their worldwide income. This was passed in order to make Spain more enticing for the rich, but once the economic crisis hit this was seen as a reason the country was hemorrhaging money. Tact quickly changed and the Spanish government began to ruthlessly pursue persons and entities they deemed in violation. Many of these business structures were too complex or too ingrained to change after the decree was rescinded in 2010, some players didn’t care. And now Ronaldo, perhaps the most recognizable sports figure in the world, has come to be embroiled in this fight to get Spain’s finances in order.
The €14.7 million that Ronaldo is said to have withheld comes, to no surprise, from image rights, with a shell corporation in the Virgin Islands used to create a screen to hide his real earnings. Should the charge hold up in court, it is likely that Ronaldo will not spend any time in jail, as prison sentences under two years are usually served on probation in Spain, but rather will face a hefty fine that will see Spain’s coffer grow a little before they move on to their next big-name target.