FIFA is poised to secure a last-minute tax exemption for all 48 World Cup qualifiers after intensive negotiations with the US Treasury. Following months of lobbying, FIFA has achieved a significant breakthrough that should result in national associations being exempt from federal taxes, although many will still have to pay state and city taxes on their World Cup earnings.
Breakthrough in Tax Exemption Talks
After discussions with the Treasury that also involved Donald Trump's World Cup taskforce, FIFA has reportedly received an undertaking that national associations can apply for tax-exempt status under Section 501(c)(3) of the Treasury's Internal Revenue Code. While a successful application is not guaranteed, FIFA has been reassured that approval is likely if applicants follow proper procedures. The main requirements for tax exemption under this section include that the organization must not benefit any individual private shareholders or engage in political activities—obligations that a national governing body should comfortably meet.
Implications for National Associations
FIFA itself has been classified as a tax-exempt organization in the US since the 1994 World Cup, but until now, it has been unable to secure similar exemptions for its members. Canada and Mexico, the other co-hosts of the 2026 World Cup, have already granted tax exemptions to national associations playing in their countries. US Treasury approval would save national associations millions of dollars and alleviate concerns about the cost of participating in the tournament, with tax rates, travel, and hotel expenses being primary worries.
Increased Tournament Payments
Last month, The Guardian revealed that many countries feared losing money on the tournament even if they reached the later stages, leading them to lobby FIFA for increased prize and participation funds. At a FIFA Council meeting in Vancouver, it was agreed to increase payments by 15%, bringing the total pot to $871 million (£645 million). All 48 countries are now guaranteed at least $12.5 million. FIFA declined to comment on the tax negotiations, with a source describing the situation as ongoing.
