Premier League tax hit tops £1bn

The tax contribution of the Premier League's 20 clubs is set to exceed £1bn this season thanks to the rising cost of player wages.

This would represent an increase of more than a third over the past two seasons, according to accountancy firm Saffery Champness.

Citing Deloitte's annual football finance review, the firm says the Premier League clubs contributed £725m to the Treasury in the 2009-10 season, including tax on salaries of £458m and NI contributions of £188m, the Financial Times reports.

Since then, the clubs have benefited from a 30% boost in broadcast revenues, which clubs tend to use on hiking wages.

But the main tax growth has come from the 50% tax rate for high earners, introduced in April 2010.

Saffery Champness said even if salaries across the league had remained flat, the high earners' rate increase would alone have accounted for an extra £115m in income tax.

Another tax benefit from football to the Exchequer has come from the increased VAT rate of 20% on ticket sales, which contributed about £25m more to the Treasury.

Deloitte's review estimated Premier League player wages for 2009-10 at £1.4bn, up 5% on the previous season. The average figure was boosted by a wage rise of 61% at Manchester City.