Brazilian Government Limits Football Clubs Spending to 70%

03/20/2015 - 09h33

Football clubs will have to limit their gross revenue spending on professional football by 70%.

This is one of the counterparts required by the Brazilian government included in the write up of the provisional measure that determines the refinancing of clubs tax debt, signed on Thursday (19) by President Dilma Rousseff.

The football spending cap is controversial between the government and the clubs, which are already lobbying to remove the text in the next 120 days, when the provisional measure will be voted on in Congress to become law.

With this measure, the purpose of the government is to prevent clubs go back into debt.

Most Brazilian associations assess that imposing a restriction like this is an intervention by the government in its administrative efforts.

They also say that there are clubs that live only for professional football, which would prevent them from limiting the spending.

The remaining share of the expenses would be dedicated to grassroots football and women's football, and other sports such as volleyball and basketball.

"Some issues need adjustment," said the president of Santos, Modesto Roma Jr, in reference to 70% cap.

According to Pluri Consultants regarding the financial statements of 2013, seven of the 12 largest Brazilian clubs exceeded the 70% limit with expenditure on professional football.

They are Corinthians, Palmeiras, Santos (SP), Botafogo (RJ), Cruzeiro (MG), Grêmio and Inter (RS).

Amongst the possible punishments is relegation, as anticipated by Folha on March 17.

Translated by CRISTIANE COSTA LIMA

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