Cyprus football in trouble

Cyprus soccer is in crisis following the decision by the Cyprus Football Association last week for an indefinite suspenion of the Cyprus league fixtures because of the clubs’ ongoing financial difficulties.

The cumulative debt of all clubs is estimated at CYP 18-20 mln. Last week the Cyprus Sports Organisation (KOA) decided to reduce its CYP 1 mln subsidy to CYP 800,000 as punishment for the clubs’ failure to clean up their finances.

KOA chairman Titos Christophides said he doubted that the subsidies were being spent wisely. Clubs are accused of using the money to buy in expensive players rather than to clean up their books.

Cyprus clubs spent CYP 3.6 mln in 2004 on transfers, wages and benefits, according to the finance ministry, which is still waiting for the clubs’ income tax, stamp duties, employer declarations and accounts.

Many players say they are owed wages; private-sector suppliers such as those supplying kit and accommodation are also said to be waiting for their money, while the banks have stopped lending.

The suspension puts at risk the ability of the Cyprus league to play in the European UEFA championships, whose rules dictate that indebted clubs may not play.

Cyprus clubs have been penalised by UEFA on several occasions.

The move to suspend follows the government’s insistence that the clubs clean up their finances before the government continues with its subsidies.

The clubs want a government subsidy of CYP 1.5 mln per year, a cut from the government’s large betting tax-take and a reduction in VAT on tickets from the standard 15% to 5%.

Clubs have until Friday to show that they have no outstanding debts to pay on income tax, VAT or salaries and must pass the UEFA financial tests by May 31.