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Rediff.com  » Sports » German sports heroes under attack for evading taxes

German sports heroes under attack for evading taxes

November 24, 2003 11:32 IST
German sports idols who moved abroad to escape the country's high tax rates were long immune to criticism because their contribution to Germany's renown around the world was seen as outweighing the fiscal loss.

But as dwindling German tax revenues force unpopular spending and pension cuts, the exile of heroes such as Franz Beckenbauer, Jan Ullrich, Boris Becker, Michael Stich and brothers Michael and Ralf Schumacher has come under new scrutiny.

Everyone from Chancellor Gerhard Schroeder and Finance Minister Hans Eichel to ordinary taxpayers is standing up to criticise the sportsmen's tax-saving moves abroad as unpatriotic, unfair and even anti-social.

Eichel was among the first to break the taboo last month when he criticised the cream of Germany's sporting heroes on a television talk show.

"I'm not among the fans of people like Boris Becker, Michael Schumacher and Franz Beckenbauer for this reason," Eichel said in an attack on those who have moved to Switzerland and Austria, where taxes are lower.

Becker, the three-times Wimbledon champion who was convicted of tax evasion by a Munich court last year and ordered to pay a 600,000-euro fine, dismissed Eichel's attack even though he recently moved to Zug in Switzerland.

"It's factually wrong as far as I'm concerned," Becker, 35, said in an interview with Bild am Sonntag newspaper. "I will continue to pay taxes in Germany on my businesses and contracts I signed before moving to Switzerland."

Becker, who won six Grand Slams, also paid $3 million in back tax for living in Munich earlier in his career while claiming tax-haven Monaco as his residence.

TAX RATE

"I came back to Germany voluntarily in 1994 and have paid more than 25 million euros in taxes since then," Becker said, referring to his return from Monaco. "For that, I've got a kick in the rear end."

But Becker's business partner, Hans-Dieter Cleven, recently acknowledged: "Tax reasons were among the reasons that Becker moved to Zug.

Cleven told Berliner Zeitung newspaper taxes in Switzerland were "reasonable" compared to Germany's top income tax rate of 48.5 percent, down from 51 percent until 2000.

The government is planning to cut that rate again next year to 42 percent -- in part in the hope that wealthy Germans will stay at home.

Schroeder, who has regularly sent telegrams congratulating six-times Formula One champion Michael Schumacher and others on winning titles, recently criticised tax exiles at a meeting of his Social Democrats party (SPD).

"Our problem is neither the economic reforms we're making nor the tax levels we have but rather what tax is actually paid here and not carted off into Switzerland or Luxembourg," Schroeder told applauding SPD members.

Another SPD leader, former Lower Saxony state premier Sigmar Gabriel, went further.

"It's unpatriotic of these people taking full advantage of the possibilities of our country all their lives but then shovelling their money into Switzerland or Liechtenstein," Gabriel told N-TV television. "I even consider that behaviour anti-social."

GERMAN PASSPORTS

Reinhard Buetikofer, co-leader of the Greens party which shares power with Schroeder's SPD, has even proposed stripping the tax exiles of their German citizenship.

"Those who don't want to pay (German) tax can give up their German passports," Buetikofer said.

Beckenbauer, who captained and later coached World Cup champions in 1974 and 1990 before helping Germany to win the race to host the 2006 World Cup finals, has lived just south of the German border in Austria for decades and was seemingly above reproach before Eichel's broadside.

Schumacher has been largely unscathed by criticism until now, in part due to his record-breaking success on the track but also because of his yearning for privacy on a secluded farm in Switzerland.

But his younger brother Ralf has faced heated criticism for moving to Salzburg, Austria, just south of the German border and for disparaging his home country.

"Germany is simply a taxation jungle," he said last year. "I don't feel like having tax collectors on my heels. I don't want to be hunted down like Boris Becker or Steffi Graf. That's why I used the chance to go abroad for tax reasons."

Former Wimbledon champion Michael Stich and champion speedskater Anni Friesinger also live in Austria. Former Tour de France champion Jan Ullrich moved from the Black Forest to Switzerland last year.

Graf stayed in Germany for many years but her father Peter, who was her manager, spent two years in jail for evading $7 million in tax on his daughter's earnings. The former tennis champion now lives in the United States with her husband Andre Agassi.

Erik Kirschbaum
Source:
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