PCC rejects Wayne Rooney 'tax dodge' complaint - Press Gazette

PCC rejects Wayne Rooney 'tax dodge' complaint

The Press Complaints Commission has rejected England footballer Wayne Rooney’s claims that a Sunday Times article on Premiership footballers’ tax avoidance arrangements was inaccurate.

Rooney was one of several footballers mentioned in the article, which was published on 16 January, headlined “Top footballers dodge millions in income tax: Rooney pays 2% on some earnings”.

It claimed Rooney had saved almost £600,000 by receiving £1.6m in loans rather than as income over a two-year period.

Rooney argued the headline was inaccurate and misleading because the loans were subject to corporation tax of 28 per cent, and claimed it was impossible for anyone to pay 2 per cent tax on their earnings.

He also said the loans were paid back the following year and that this was not mentioned in the article.

The PCC said The Sunday Times had defended itself by arguing that ‘current legislation classified such personal loans offered by limited companies (which was a perfectly legal tax mitigation device) as a benefit in kind, thus incurring a rate of only 2 per cent on the total sum of the loan”.

The paper said readers would not have been misled by the headline and would have understood the arrangement would be explained in the text of the article itself.

The commission acknowledged the headline require “further explanation” because it was not “the full position” – but concluded that this explanation was covered in the article.

The article also clarified that the arrangement was legal, had already been subject to corporation tax, and was likely to be repaid.

Rooney also complained under clause two of the Editors’ Code of Practice relating to opportunity to reply, and this too was rejected.

The fact the Sunday Times offered to clarify that Rooney paid all his taxes at the legally required rate was considered to be a “sensible and proportionate” response.

“This was a complicated financial arrangement and it was important for the commission to consider the circumstances in full,’said PCC director Stephen Abell.

‘The commission’s case law consistently makes clear that headlines – which are by their nature reductive – need to be read alongside the accompanying article.

“Although the PCC has upheld complaints in the past where there has been too great a disparity between the headline and the text of the article, this was not a feature on this occasion. As a result, the complaint was not upheld”.

Here is the PCC’s adjudication:

Headlines are often the subject of complaints to the commission under the terms of clause 1 (accuracy) of the code, which states that newspapers must take care not to publish inaccurate, misleading or distorted information.

The commission recognises that headlines are, by their nature, reductive, attempting to summarise complex issues succinctly, and must be read along with the accompanying articles. However, it has in the past ruled that too great a disparity between the headline and the text of the article can raise a breach of the code.

The commission did not consider that there was such a disparity on this occasion. It was accepted that the complainant employed, legally, a complicated system by which he paid 2% tax on loans from his own company. In that context, the reference to him paying “2% on some earnings” was not, in the commission’s view, inaccurate, even if it was not the full position.

The headline clearly required further explanation which the commission considered was contained in the articles themselves. These made clear that, by this arrangement, the money, which had already been subject to corporation tax at 28%, was a “director’s loan”, in respect of which tax was paid, and it was likely that the loan would have to be repaid. They also made clear that the arrangement was legal.

Taking this into account, the commission believed that readers of the coverage as a whole would not be misled as to the specific structure of the tax arrangements of the complainant. In the circumstances, the commission ruled that clause one (accuracy) of the code had not been breached.

However, the commission did note that the complainant had made clear that the loans in question had been repaid, and that the requisite tax had been paid on them.

It felt that readers should be made aware of this and noted that the newspaper was willing to publish a clarification, stating that it accepted the complainant’s assurance that he “pays all his taxes at the full legally required rates”. This was a sensible, and proportionate, response to the complaint, and there were no further issues to pursue under clause 2 of the code.