Another FC Barcelona striker has been accused of tax evasion – and this time, it’s not Spanish tax authorities who are leveling the accusations. A Brazilian judge has charged that Neymar da Silva Santos Júnior, known to most of the world simply as Neymar, took steps to avoid reporting income and paying tax. As a result, he has ordered 188.8 million reals ($47.75 million U.S.) of Neymar’s assets frozen: that amount is roughly three times more than the amount of tax at issue.
Neymar, a native of Brazil, made his professional sports debut on March 7, 2009, at the age of 17. He quickly became a star with former forward, über footballer (and fellow Brazilian) Pelé calling him “an excellent player.”
In 2013, Neymar announced that he would be joining superstar Lionel Messi on FC Barcelona. That contract, together with a winning team, helped Neymar climb the ranks of the soccer elite: in 2015, Neymar was ranked #82 on Forbes’ Celebrity 100 list and #23 on Forbes’ list of the World’s Highest Paid Athletes racking up $14 million in salary and $17 million in endorsements last year alone.
At the time, the details of the contract to bring Neymar over to FC Barcelona were kept quiet. Leaks suggested the amount of the signing was on the low side for a footballer of Neymar’s talent, at just about $65 million. The club has since acknowledged that Neymar’s signing was worth significantly more: at least $114 million.
Allegedly, payments related to the signing were made to a Brazilian company controlled by Neymar’s father, which Spanish prosecutors allege were taxable but disguised as other payments in order to avoid reporting and tax requirements. Payments were also made to Neymar’s former club (Santos). Santos, believing it had been cheated, subsequently filed court papers in an effort to find out more details of the transaction. At the time, Neymar and his father denied any wrongdoing, suggesting that any resulting tax consequences of the sale would be addressed in Brazil. That’s exactly what happened.
In Brazil, Judge Carlos Muta charged Neymar with “omitting sources of income from abroad” from 2011 and 2013. The amount of corresponding tax at stake is reportedly 63 million reals ($15.93 million U.S.) for those years. According to reports, FC Barcelona was identified as the source of that money.
Why do the payments predate Neymar’s transfer? Reportedly, it’s all about the art of the deal. Santos has alleged that negotiations for the star played began as early as November of 2011. When questioned last year, Neymar Sr. denied the allegations, saying:
I repeat that I owe nothing to the taxman, not in Brazil nor in Spain, absolutely nothing.
Despite those protestations, it looks like Spain may get a bite at the apple, too. Earlier this year, a Spanish Court found that there was enough evidence to go to trial in Spain over the transaction. While Neymar and his father were not charged in Spain, Neymar’s club, FC Barcelona, will go to trial on tax fraud charges as will club president Josep Bartomeu, and former club president Alexandre “Sandro” Rosell. Like Neymar and his father, the team has denied any wrongdoing.
In addition to the team’s personnel, Neymar joins a growing list of FC Barcelona soccer stars under the tax microscope. Teammate Lionel Messi is currently awaiting trial on tax charges, while just two weeks ago, Spanish authorities announced an investigation into underpayments allegedly made by midfielder Javier Mascherano.
Notwithstanding its tax woes, FC Barcelona is thought to be worth $3.16 billion. Forbes ranks the team at #2 on its list of the World’s Most Valuable Soccer Teams – just behind La Liga rival Real Madrid.
Neymar has not made a public comment and his web site is currently down.
