Real Madrid Transfers: A possible way to afford Cristiano Ronaldo’s wages

Real Madrid, Cristiano Ronaldo (Photo by Matthew Ashton - AMA/Getty Images)
Real Madrid, Cristiano Ronaldo (Photo by Matthew Ashton - AMA/Getty Images) /

Real Madrid will do whatever they can to sign a superstar attacker next season. For three straight seasons, Karim Benzema has been carrying the full goal-scoring load on his own, as Los Blancos have not come close to replacing the production lost by Cristiano Ronaldo.

Ideally, Real would sign a superstar of the future. Someone who can write his legacy as the face of the Madrid project, such as Kylian Mbappe, and be what Ronaldo was for Madrid in the last decade for a whole new 10 years. Erling Haaland also fits the bill as this kind of superstar player, though he is a striker and not a wide forward.

But it is possible Ronaldo could re-join Madrid. Manu Sainz of AS reported that Ronaldo wants to leave Juventus for Madrid. There are some logistical issues with signing Ronaldo, beyond the fact that signing him could mean sacrificing the future. However, if Real cannot sign Mbappe nor Haaland, then using that money on Ronaldo’s wages would make sense.

In Serie A, “foreign” players have a tax exemption of 50 percent, which means Ronaldo’s 31 million euro wages at Juventus will be harder for Real Madrid to cover.

Cristiano Ronaldo could have a tax rate of 19 percent instead of 50 percent if he signs a one-year deal with Real Madrid

Except, there seems to be a way in which Los Blancos can take on Ronaldo’s wages, and it has to do with a different aspect of taxation.

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Sports lawyer Toni Roca told Mario de la Riva of AS (article in Spanish) that so long as Real Madrid give Cristiano Ronaldo a one-year contract, which would be fully expected for the 36-year-old, the player would avoid paying 50 percent of his salary in taxes. That’s because he would be considered a non-resident of Spain and would only have to pay 19 percent of his salary.

These tax loopholes aren’t ethical, nor are they great for people living in these countries. We must make that clear. But the loophole exists, and you’d expect to see Ronaldo and Real Madrid take advantage of it in order to facilitate a move.

For Madrid, this classification and avoidance of a higher tax rate would be a benefit to their pursuit of Ronaldo.

Without the reduction, they would not be able to match Ronaldo’s salary at Juve at all, given they would have to pay much more than 31 million euros to even approach the kind of money CR7 is pulling in Turin.

But a 19 percent taxation rate, which would also apply to Ronaldo’s other earnings, for one season would enable Real to make a blockbuster signing happen.

Ronaldo, as far as we should be concerned, is “Plan B” to the collective “Plan A” of Kylian Mbappe and Erling Haaland. He might not even be “Plan B” either, because that’s all assuming Real have the money, still want to make a deal, and both Juve and Ronaldo will OK things. Most of the decision is in Ronaldo’s own hands, as well as Real’s as the party who would have to accept his move, but Juve, of course, have their own say. Ronaldo is under contract with them for the 2021-2022 season.

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But if Ronaldo wants a move and Real see him as their best (only?) option in the attack, then this taxation wrinkle could benefit Los Merengues significantly. It could be their path to a short-term goal-scoring solution.