Tax Reforms Threaten Sports Clubs
Gordon Brown's tax reforms for sports clubs are having the opposite effect to that intended as tens of
thousands of clubs close their doors across Britain.
The reforms that offer charitable
status to clubs mean that local authorities are no longer obliged to give clubs rate relief, and that means that many clubs
have gone so far into the red they have reached or are approaching bankruptcy.
Only 100 of our 110,000 sports clubs have taken charitable status and that
means annual business rates of £40 million are now being charged to those who have not attained charitable status. Rates are
the biggest expense for sports clubs and around 40,000 have closed in the last ten years, a devastating blow to the communities
Amongst other bodies the FA, the RFU
and the LTA are demanding emergency meetings with deputy prime minister John Prescott to reverse the decline. Nick Eastwood,
financial director of the RFU describes the government policy as hopelessly flawed. "The government has made what is a relatively
simple matter into the most unbelievably complex issue. The entire thing has been a complete
waste of time".
In order for a club to become a charity
it needs to appoint a board of trustees, employ a solicitor and pay for auditors. The move has been seen as a slap in the
face for the millions of people who donate their time for the sports they love, and with most clubs operating as non-profit
organisations charging business rates seems to be unfair.
The grass roots impact of the policy is summed up by former Yorkshire and England batsman Brian Close: "It's very
disappointing when this happens to a club, and there are many other clubs in the same position who are encouraging youth to
play sport. It's very sad."