Equalisation Policy will hit Freo hard

[yakka man]

http://www.theage.com.au/afl/afl-ne...y-with-equalisation-plans-20140603-zrwpt.html

Fairfax Media understands Carlton, Essendon, Fremantle, Geelong and Richmond have been stunned at learning they will be taxed between $200,000 and $400,000 annually over the next two years compared with the capped $500,000 to be carried by Collingwood, Hawthorn and West Coast.

Several disillusioned chief executives have pointed out to the AFL that middle-ranked clubs will be the hardest hit, with some being taxed close to 50 per cent of their profits compared with closer to 10 per cent by Collingwood.

So a large percentage of our profits will be stripped away to fund equalisation while a small percentage of the bigger clubs is taken. As soon as we start to really grow the club we're hit hard while clubs like West Coast, Collingwood and Hawthorn will barely notice a thing. Obviously our funding to WA Footy was not factored in. Hopefully the other middle-tier clubs band together to fight this. I have no problem with the poorer clubs being helped out and I like that they will be able to pay 100% of the salary cap. But don't do it at the expense of the clubs that have worked hard to build a strong culture and strong financial stability.

$200,000-$400,000 was basically 40-90% of our profit last year if I remember correctly.

 

[estibador]

F**ked if I want my membership money syphoned off so spoilt Victorian supporters can have their tickets subsidised. If those supporters want their clubs to have more money they can foot the bill themselves.

I don't see why the AFL can't chuck in an extra few million from their bazillion dollar tv rights without taking money from clubs.

 

[Purple_Passion]

Middle-ranked clubs like Freo were always going to be the hardest hit with this "equalisation".

Quite annoying to think that my money and our clubs money will be going to North, St Kilda, GWS, Dogs, etc.

 

[estibador]

But McLachlan is understood to have been more sympathetic towards fund-raising foundations, such as those being run by Richmond and Sydney and more recently established by St Kilda, which will not be included in club taxable revenues.

Ok, let's set up a fund-raising foundation and do a deal with the WAFC to give them all our profits which they can then siphon back into our foundation through a Cayman Islands Offshore Holding Corporation.

 

[samFFC]

Middle-ranked clubs like Freo were always going to be the hardest hit with this "equalisation".

Quite annoying to think that my money and our clubs money will be going to North, St Kilda, GWS, Dogs, etc.

Better than Collingwood and West Coast, who are hardly bearing the brunt. Less tax from them is basically us subsidising (paying) them too.

 

[DardySingh360]

Should be no equalisation at all, they're meant to be clubs not franchises. Dog eat dog world, survival of the fittest and all that

 

[Grape Bear]

Typical AFL where some clubs are more equal than others. In the real world, the higher your earning, the higher your tax - unless you're Gina Rinehart.

Hang on. That's about right.

Play on.

(Seriously, I hope more stink is raised about this by the mid-tier clubs - either we pay a capped proportion of our profits as well, or the "big clubs" need to pay an equal percentage of their profit i.e. 20% across the board)

 

[leeloo]

Yeah, that makes sense, tax the middle ranked clubs hard so that they then need equalisation funds

 

[Taylor]

If this is a profit tax then we can avoid it by buying a series of property developments and using our current profit to fund the debt, the only downside is that we will need to continue expanding the portfolio as the return on investment begins to get cash positive.

 

[Paracleet]

Hang on isn't our underlying profit 2 or 3 million and then that is mostly chewed up by our WA footy commission payment? If the AFL tale a slice of that pie doesn't it just reduce the amount the WAFC have available to take? That would still leave us with the same final profit approximately.

 

[Taylor]

Hang on isn't our underlying profit 2 or 3 million and then that is mostly chewed up by our WA footy commission payment? If the AFL tale a slice of that pie doesn't it just reduce the amount the WAFC have available to take? That would still leave us with the same final profit approximately.

What if the WAFC percentage and the AFL requirement is greater than 100%?

 

[Silent Alarm]

I am a socialist to the end but more so for things like making sure people don't die.

It's galling that people who pay, what, $300 a year or $50 a game are now paying for people who can't afford $17 for a blockbuster at an incredibly better stadium. Considering the way Freo and the Eagles essentially fund important things like grass roots, suburban, and country football then how can you discount that? I'm certain that if Collingwood were paying the rego of every kid from Carlton Gardens to Clifton Hill, they'd have their fees pegged down.

 

[go_the_dockers]

All the clubs facing six-figure taxes have been told the formula has been based on last year’s profits to dissuade - they suspect - any attempts to rewrite revenues.

Read more: http://www.theage.com.au/afl/afl-ne...ation-plans-20140603-zrwpt.html#ixzz33crDrxv9

Once again the AFL have completely got this wrong, they should not be taxing profits they should be taxing how much clubs spend outside of the salary cap. By taxing profits a club which pays their coaches 5 million and has a 1million dollar profit will be taxed less than a club that pays their coaches 4 million and has a 2 million dollar profit.

 

[Paracleet]

What if the WAFC percentage and the AFL requirement is greater than 100%?

So far as I can understand it the amount the WAFC take is discretionary based on our profit, not a fixed fee.

 

[beetz]

Hang on, so by taxing the middle tier clubs they will just widen the gap between them and the top tier clubs? What's the reasoning behind that?!

 

[Paracleet]

The obvious solution is to give the teams a equal cut of the tv money directly thus reducing the relative disparity. Not going to happen while we have ludicrous situation of the national administrator of the sport and the league body being one and the same organisation.

 

[Belnakor]

Not too bad, our finances are on the upswing so while we had a modest profit last year, my understanding is the team store has been going gangbusters etc?

 

[Bender571]

Hang on, so by taxing the middle tier clubs they will just widen the gap between them and the top tier clubs? What's the reasoning behind that?!

They aren't just taxing the middle clubs, they're taxing the top clubs too but there is a cap on how much tax they pay. The complaint is that middle clubs are being taxed a bigger percentage of their profits.

The equalisation idea has merit because the AFL manipulate the fixture to maximise revenue. This results in the poor clubs getting screwed over whilst the rich clubs get rich. So it's makes sense for the rich clubs to share some of their wealth with the poor considering that wealth was generated to the poor clubs detriment. However this is really only a Victorian issue, because the interstate teams aren't making money because of a favourable fixture

 

[Lach72]

They aren't just taxing the middle clubs, they're taxing the top clubs too but there is a cap on how much tax they pay. The complaint is that middle clubs are being taxed a bigger percentage of their profits.

The equalisation idea has merit because the AFL manipulate the fixture to maximise revenue. This results in the poor clubs getting screwed over whilst the rich clubs get rich. So it's makes sense for the rich clubs to share some of their wealth with the poor considering that wealth was generated to the poor clubs detriment. However this is really only a Victorian issue, because the interstate teams aren't making money because of a favourable fixture

And they pay no money to support Victorian football.

We are already being taxed 1 million and the Eagles 2 million that goes to the WAFC.

They can **** off

 

[PapaJ]

They aren't just taxing the middle clubs, they're taxing the top clubs too but there is a cap on how much tax they pay. The complaint is that middle clubs are being taxed a bigger percentage of their profits.

The equalisation idea has merit because the AFL manipulate the fixture to maximise revenue. This results in the poor clubs getting screwed over whilst the rich clubs get rich. So it's makes sense for the rich clubs to share some of their wealth with the poor considering that wealth was generated to the poor clubs detriment. However this is really only a Victorian issue, because the interstate teams aren't making money because of a favourable fixture

Yeah, something like that anyway. The whole AFL is so horribly contrived in so many ways, and with the surplus but now entrenched extra Vic clubs, there's too many teams that have to get the arse end of the AFL TV and fixturing deals in their home state, so fairness says they should be compensated - though smartness says that some of them shouldn't exist at all.

Either way, without going on about it, it's a Vic issue essentially - (except the expansion clubs which are a particular case, they will need money from the system so to speak.)

 

[Purple Maverick]

Once again the AFL have completely got this wrong, they should not be taxing profits they should be taxing how much clubs spend outside of the salary cap. By taxing profits a club which pays their coaches 5 million and has a 1million dollar profit will be taxed less than a club that pays their coaches 4 million and has a 2 million dollar profit.

They should be taxing clubs on football department spend, then also providing credits based on other forced payments (WAFC fees/commission/royalties) and cost of operating stadia.

The whole 'profit' terminology is wrong, football clubs are NFP organisations, thus the term 'surplus' should be used!!!!

 

[E Shed]

I thought the age of entitlement was over. I heard Abbott and Hockey say it so it must be true.

 

[slicedndiced]

This is why I was dead against Polo boy Gil taking over the reins from Fat Andy.

We will never see positive change in the AFL whilst this nepotistic changing of the guard continues.

 

[PapaJ]

They should be taxing clubs on football department spend, then also providing credits based on other forced payments (WAFC fees/commission/royalties) and cost of operating stadia.

The whole 'profit' terminology is wrong, football clubs are NFP organisations, thus the term 'surplus' should be used!!!!

In principle this sounds good to me. Instead it looks like they're going to cap football department spend across the board (as well as all the other stuff). It's just big handed and unnecessary approach for mine.

 

[Nickos66]

What motivation do clubs like ours have to even bother aspiring to profit from each season anymore? It almost sounds more tempting to roll over and wait for our tummies to be scratched and fed by just breaking even, or even slightly in the red..