UK tax authorities launched an investigation into Manchester City in 2018. The probe aimed to determine whether the club used complex arrangements to reduce tax. This information was reported by the Financial Times, citing people with knowledge of the situation. The investigation was initiated following the publication of leaked club emails in the German weekly Der Spiegel in late 2018.
The investigation by HM Revenue & Customs was never formally closed. However, HMRC has taken no action against the club. When contacted by AFP, the tax office declined to comment, citing taxpayer confidentiality. Manchester City, which is backed by Abu Dhabi, was recently found guilty of breaching Premier League financial rules.
An independent commission found Manchester City guilty of violating Premier League financial rules between 2009 and 2018. The commission stated that the club artificially inflated revenues and reduced costs by more than £900 million ($1.2 billion) during this period. The club has since appealed the ruling, and no sanction has yet been decided.
The scandal threatens to tarnish one of Abu Dhabi's most dazzling showcases of "soft power". It also confronts the UK with a delicate balancing act in preserving its long-standing ties with the Emirates. British Prime Minister Andy Burnham, the former mayor of Manchester, recently praised the investments made by the club's Emirati owners.
Downing Street subsequently qualified Burnham's remarks, emphasising that no one is "above the rules". The Premier League's investigation into Manchester City's financial dealings led to the club being found guilty of more than 100 breaches of financial rules. The club risks substantial points deductions, a fine, and even expulsion from England's top division.
A takeover of Manchester City in 2008 by Sheikh Mansour bin Zayed al-Nahyan transformed the club. Since then, they have won eight English Premier League titles and one Champions League trophy. The club's success on the pitch has been a showcase for Abu Dhabi's influence and investment in the UK.
Manchester City had yet to respond to an AFP request for comment on the FT report. The club's owners have been a significant presence in English football since their takeover in 2008. The outcome of the Premier League's sanctions against Manchester City remains to be seen.
Key points
- The UK tax authority's investigation into Manchester City did not involve allegations of deliberate fraud.
- Manchester City's owners have invested heavily in the club since their takeover in 2008.
- The club faces potential sanctions, including points deductions, fines, and expulsion from England's top division.
