A European Supreme Court announced Thursday that Barcelona, Real Madrid and two other clubs in the Spanish soccer league will be forced to pay back taxes in the millions, in a victory for the European Union in its battle against tax evasion.
In its 2016 ruling, the European Commission said that Barcelona, Real Madrid, Athletic Bilbao and Osasuna have enjoyed a tax rate of 25% for more than 20 years, which gives them an unfair advantage of more than 30% compared to other professional clubs.
The commission ordered the four clubs - which enjoyed a lower tax rate because they were treated as non-profit organizations rather than professional clubs with limited liability - to pay up to 5 million euros ($ 6 million) each in back taxes.
Barcelona later appealed the decision and obtained a ruling in 2019 stating that the European Union's competition watchdog had not proven - according to any legal standard - that the measure conferred an advantage for its beneficiaries.
The European Commission then appealed to the Luxembourg-based Court of Justice of the European Union, saying that the lower court had made a mistake in trying to prove that the clubs enjoyed an economic advantage.
This comes as a blow to Spanish clubs who are suffering financially due to the Corona pandemic, which has reduced their profits significantly.