Los Angeles Rams quarterback Matthew Stafford's recent trip to Melbourne for the NFL's historic first regular-season game in Australia has become the subject of intense scrutiny over potential tax liabilities. Speculation arose from a viral calculation suggesting Stafford could face a tax bill approaching $1 million USD for his appearance.
The estimate, originating from the American football account MLFootball, claimed the quarterback might net only $947,000 from his $2.2 million Week 1 income after Australian and U.S. taxes. The account further estimated Stafford's total tax burden at approximately $1.25 million, including Australian taxes and $293,000 in California state tax, with U.S. federal liabilities potentially offset by foreign tax credits.
However, the Australian Taxation Office (ATO) has not confirmed the viral figure, and tax professionals have questioned the calculation's assumptions. Belinda Raso, director at Tax Invest Accounting, stated that the viral calculation was based on an assumed 45% tax rate and did not account for Australia's progressive tax scale or deductible work-related expenses.
"That's just their assumption at the 45 per cent tax rate. It doesn’t automatically go straight to that, we do have a sliding tax scale," Raso told news.com.au. "But it’s massive numbers that we’re talking about. If you’re earning that much, it’s a big cut of your income. The main thing is you’ve got to take work-related expenses out."
The final tax owed would depend on the portion of income attributed to Stafford's time in Australia and any applicable deductions, Raso added.
The ATO confirmed that overseas athletes are generally subject to withholding tax on payments for sporting activities performed in Australia. "This means that amounts are required to be withheld from payments made to foreign residents in relation to their sports and related activities," an ATO spokesperson told news.com.au. The spokesperson also noted that athletes with deductible expenses could apply to vary their withholding rate, and foreign tax credits could offset domestic tax liabilities.
Stafford's arrival in Melbourne, less than a day before the game against the San Francisco 49ers at the Melbourne Cricket Ground (MCG), contrasted sharply with the 49ers' week-long acclimatization period. The Rams' rapid travel schedule was designed to maintain player routine and manage jet lag, though some acknowledged a desire for more fan interaction.
Despite the travel discussions, the event was anticipated to generate significant economic activity. NAB forecast over $300 million in spending across various sectors, with the Victorian government estimating up to 7,000 American visitors.
