BY JONATHAN KOMEN
|Two-time Berlin Marathon winner Florence Kiplagat|
Sharp reactions, including threats to defect, greeted the taxman’s plans to levy tax from athletes’ earnings.
“We’ll defect to countries that “do not tax their sportsmen and women,” they said.
KRA said on Tuesday that athletes, like other Kenyans, are not exempted from paying taxes and would be required to conform to the tax regime as provided for in the Constitution.
The KRA report said sportsmen and women should pay taxes like other taxpayers. Resident athletes should pay taxes in four equal instalments (April, June, September and December) and any balances should be paid by April 30 of the subsequent year.
But two-time Berlin Marathon winner Florence Kiplagat said she is considering switching her allegiance to another nation.
“We have invested here although the Government has done nothing to support us. We toil to build the image of this country without any benefits. I can decide to change my nationality now,” said Kiplagat, the 2009 world cross-country champion.
But KRA says it will take into account taxes paid abroad when they are computing levies owed to the Kenya Government.
The taxman says taxes paid abroad should be offset locally in line with provisions made in the Income Tax Act.
“Sportspersons should give evidence of the tax paid overseas to be allowed to offset this against tax computed locally,” says KRA.
Sammy Tangui, a pacesetter for world 800m record-holder David Rudisha, said that not all races abroad provide receipts of taxation. “We may be taxed twice. Most athletes will now consider changing citizenship,” he said.
Two-time world 1,500m champion, Asbel Kiprop said athletes will have little take-home after taxation.
“In IAAF Diamond League races, for example, winners receive $10,000 (Sh858,000). If it takes place in America, taxation is 30 per cent. The manager takes 15 per cent, $2,000 goes towards a ticket and other expenses, including the coach and training partners,” he said.
“It’s a double tragedy. Most Kenyan athletes live in debt abroad and are owed money by agents. When they earn money, they refund for air tickets and pay agents 15 per cent fees. This will attract defections to other countries.”
Kiprop said KRA wants to reap where it has never sown. “When athletes pick up injuries, no one bothers. Athletes from other countries, even Ethiopia, enjoy better care,” he said.
Two-time world marathon winner Edna Kiplagat said she appreciates that although no one should be exempted from paying tax, they need time.
“We will comply but we need time. They should not backdate (the new regulation) since we have no money to pay,” said Edna.
Athletics Kenya President Isaiah Kiplagat said athletes were taken through the KRA taxation plan during the athletes’ seminar in Eldoret last November.