Does Clermont Foot 63 pay more social security contributions than all Bundesliga clubs, as the LFP president says?


Question asked by Marc on May 6, 2022.

You are asking us to verify a statement by Vincent Labrune, president since September 2020 of the Professional Football League (LFP). Asked by the daily the echoes regarding the financial situation of French professional football, he indicates that the Clermont-Ferrand football club, Clermont Foot 63 (CF63), which currently plays in Ligue 1 (championship bringing together the best French clubs), “pays more charges on its own than all the clubs in the Bundesliga [équivalent allemand de la Ligue 1, ndlr]».

In length, this passage from the interview published on May 6 (subscribers only) is as follows: “For decades, French football has had to face very strong constraints which penalize us against the other major European leagues. We have a domestic audiovisual market which is much less buoyant than that of our competitors… Furthermore, we have club owners who often do not have the same financial strength as their European counterparts. Finally, we suffer from particularly heavy taxation. The Clermont club, in Ligue 1, pays more charges on its own than all the clubs in the Bundesliga. Result, since the Bosman judgment of the mid-1990s [qui autorise la libre circulation des joueurs en Europe]our teams are forced, in order to survive economically, to sell their talents to their European competitors.”

Confusion with ASSE

This comparison between the contributions borne by Clermont Foot 63 and those of the eighteen best clubs in Germany is inspired by a study commissioned by the former Premier League union, which essentially represented the interests of League clubs. 1, now replaced by the new United Foot union (born in June 2021 from the merger between the Premier League and the Union of Professional Football Clubs).

The document, made public in March 2019, is entitled “The weight of social charges and taxation on French football”. To illustrate the idea of ​​a social and fiscal imbalance between French clubs on the one hand, and clubs from the other leagues of the European « Big 5 » (England, Germany, Spain, Italy) on the other hand, a few “striking examples”. Among which : « PSG pays more social charges than all Bundesliga, La Liga and Serie A clubs combined »; “OL or OM pay more social charges than the Bundesliga and La Liga combined”; Where “ASSE pays more social charges than the Bundesliga”. But no mention here of the CF63. For good reason: in 2019, when the study was published, the Auvergne club was not yet in Ligue 1 (which it only joined in 2021, and for the first time in its history).

There therefore appears a first limit to the words of Vincent Labrune: it is the club of Saint-Etienne, and not that of Clermont, which was presented in this document as fulfilling more “burdens” than the whole of the Bundesliga . A confusion all the more debatable as AS Saint-Etienne necessarily pays more contributions than Clermont Foot 63, the salaries received by the players of the first club being generally higher than those paid by the second.

Another clarification, provided by Pierre Rondeau, specialist in football economics: the comparison between French and European clubs does not concern « all contributions », but only employers’ social security contributions. Which have the particularity that they are capped in three countries of the « Big 5 » and low in England. Premier League also underlines this in its study: « The employer’s contributions are much higher in France than abroad, because the contribution rates are higher (from 30% to 40%) and we do not have a capping system as there may be in Europe (except the United Kingdom which is in the same situation as us).

Last nuance, finally, to bring to the conclusions of Vincent Labrune: the study carried out by Premier League, on which it is based, “date before the Covid-19 crisis”, point Pierre Rondeau. Gold, “Since then, the clubs have benefited from significant exemptions from charges”, which changed the weight of contributions on their budget. In April 2020, for example, they had obtained exemption from employer contributions on 70% of the salaries received by their players, then placed on technical unemployment due to confinement.

If the assertion of the president of the LFP is therefore, in several respects, to qualify, what about the general idea defended? Can we say, overall, that the cost for a French club between what it has to pay and what the player finally receives (in net salary) puts him at a disadvantage compared to his European counterparts? « The overall cost of labor for football clubs is a constraint that does introduce a distortion of competition in Europe »summarized in 2019 Luc Arrondel, economist and co-author of the book soccer moneyquestioned by the site ecofoot.fr.

Capped social charges

What is this “labour cost” made up of? Net salary paid to players, but also social security contributions (financing the social protection system), which are divided between employer contributions for clubs, and employee contributions, CSG and CRDS for players.

In their work soccer moneypublished in 2019, the economists Luc Arrondel and Richard Duhautois publish a table, taking as a basis a gross annual remuneration (for the player) of 100,000 euros, then one million euros. “We reworked the 2018 table update but found no differences. So it’s still relevant. »they explain to CheckNews .

For a gross remuneration of one million euros for the employee, a French club will thus pay 270,300 euros in employer contributions, while the German club will pay out 23,700 euros (12,910 euros in Spain, 84,600 euros in Italy and 136 700 in the UK). These contributions are therefore 11.5 times higher in France than in Germany. The player, for his part, will have to pay 116,400 euros in social security contributions in France, against 24,600 euros across the Rhine (2,740 euros in Spain, 19,300 euros in Italy, 23,900 euros in the United Kingdom). That is 4.7 times more in France compared to Germany.

The main reason for these discrepancies being that Germany, like Italy and Spain, has capped these levies. To simplify: past a few tens of thousands of euros in salary, the ceiling being reached, the amount of employer and employee contributions no longer increases.

The gap with the British is explained by very different contribution rates. Employer contributions represent up to 42% of gross salary in France, compared to only 13% on the other side of the Channel. Employee deductions and contributions reach 22% and 12% respectively.

More favorable taxation

But in these international super-high-wage markets, the comparison between clubs and players is not so much about the player’s gross or net salary as about the after-tax income. However, the significant cost for French clubs represented by social security contributions is partially offset by a tax on income slightly more favorable than elsewhere in the “Big 5”. “French taxation is not an obstacle to the competitiveness of our football wrote in 2019 the union of Premier League clubs. First of all, the progressiveness of the tax in France is quite favorable […] The principle of the family quotient (with discount) but also the regime of impatriates for certain players are also more effective than in other European countries.The impatriation regime allows footballers recruited by a French club to deduct from tax 30% of their total net remuneration, for eight years.

According to the calculations provided by the Premier League, to pay a player a salary net of tax and social security contributions of 1.8 million euros per year (i.e. a remuneration rather located at the top of the basket in Ligue 1, for a player with a team like Nice or Monaco), a club in France must pay a total of 3,628,000 euros, against 2,665,000 euros in Germany. The French club must thus pay twice the net remuneration of the player, against 1.5 times across the Rhine.

Conclusion: whatever the amount of remuneration, “the salary cost is higher in France”,according to Luc Arrondel. With for example, for a remuneration of 1.8 million net in the pocket of the player, social contributions (employers and wages) 30 times higher in France than in Germany. But if income tax is also taken into account, the whole of what a club must pay to ensure a net remuneration of 1.8 million euros for the player is no longer « only » 2, 1 times more important in France than in Germany.

It should be noted, finally, that to this initial distortion, are added the tax advantages granted to the football sector by each of the nations. Latest example: a decree adopted in 2019 in Italy, which extends tax exemptions hitherto established to limit the “brain drain” to athletes. Thanks to this text, unofficially called the « Ronaldo law » (because it contributed to the recruitment of the Portuguese champion), any foreign player joining, for at least two years, the workforce of an Italian championship team can offload half of his income tax.

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