Would a tax break from the U.K. government help the European Tour?
Along with the Claret Jug and the Champions Belt — a replica of the red, Morocco belt that was given to winner of the event back in 1860 — was a sizable check that went along with the victory. The £850,000 Oosthuizen earned for his clinical victory at St. Andrews was £100,000 more than what Stewart Cink earned in 2009 for his win at Turnberrry. The decision to increase the prize money was made after the euro and British pound declined significantly in relation to the U.S. dollar.
But that’s not even the biggest story regarding the check Oosthuizen received for his victory. Like most European countries, a win on foreign soil usually comes with a giant caveat in the form of an income tax rule that could leave the South African lighter in the wallet.
As the Daily Telegraph noted in an earlier story regarding sprint Usain Bolt’s decision not to race in the U.K. due to tax reasons, the country is walking a line between ridiculous and absurd when it comes to their current tax rules on foreign sports stars:
Since April, foreign sports stars competing in Britain are liable for a top rate of income tax of 50 per cent but, controversially, the tax is charged not just on the money they earn in Britain but on a proportion of their worldwide sponsorship income.
Going by the Telegraph’s figures, that would mean Oosthuizen would be in line to be significantly taxed on his British Open winnings. Fair or not, it’s apparent that the U.K.’s tax rules are rubbing some athletes the wrong way.
The article also noted that the laws in the U.K. have kept Roger Federer away from playing Queen’s, the event preceding Wimbledon, as well as Sergio Garcia from playing in the BMW PGA Championship event at Wentworth for the past nine years.
The European Tour, finally noticing the strain the tax rules are having are their tour, have asked the U.K. government to consider easing the tax rules on athletes competing in the country.
Events like the Wales Open at Celtic Manor, along with a number of other events, could stand to gain a number of international commitments — especially from players currently splitting their time between the PGA and European Tour.
“These tax rules are discouraging leading golfers and indeed all leading sportsmen and women from competing in Britain,” said European Tour spokesman Mitchell Platts in a recent Golf World article. “Our aim is to attract the best players to participate in the best tournaments for our audiences in the U.K., and we strongly believe that this tax rule is seriously hampering our efforts.”