Foreign Pride fighters vs. Japanese taxes

Several foreign mixed martial artists unknowingly failed to pay Japanese taxes, reports the Asahi:

They may have had no problems grabbing opponents’ necks, locking legs in submission holds or pinning rivals’ backs to the mat. But a number of top foreign fighters in the former Pride mixed martial arts battles could not grasp Japan’s complicated tax rules.

The Tokyo Regional Taxation Bureau examined the earnings of nearly 10 fighters and found at least five of them failed to pay a combined 20 million yen ($192,000) in consumption tax on their winnings between 2004 and 2006 , sources said Thursday.

The five included Mirko Cro Cop, whose real name is Mirko Filipovic, from Croatia, Brazilians Wanderlei Silva and Antonio Rodrigo Nogueira, and Mark Hunt from New Zealand, according to the sources.

The five have filed corrected returns, the sources said.

In principle, Japanese promoters deduct income tax when they pay athletes of foreign nationalities.

However, foreign athletes are required to pay the consumption tax on their own if they earn 10 million yen or more a year in prize money and other income in Japan. Complicating the matter is the fact that the consumption tax is applied two years after that period, but the levies are made on earnings for the latest year.

Apparently the Japanese promoters of Pride (who have since gone out of business) failed to notify the fighters of the specific taxes they had to pay.