Spain faces a 30% U.S. withholding tax on its $50 million FIFA World Cup prize. The IRS claims the winnings are U.S.-source income because the 2026 tournament was hosted on American soil — in stadiums across Miami, New York, and other U.S. cities.
Rep. Greg Murphy called the levy “a ripoff” in a Fox News segment. “Spain provides no services to the U.S.,” he argued. “This is a cash grab.”
The tax applies to all prize tiers. Third-place finishers — France and England in 2026 — earn $30 million. They face the same 30% IRS deduction, according to Fox Sports. Per player, the tax impact remains significant.
| Prize Tier | Amount | IRS Withholding (30%) | Net to Team |
|---|---|---|---|
| Winner (Spain) | $50M | $15M | $35M |
| Runner-up | $40M | $12M | $28M |
| Third place | $30M | $9M | $21M |
The IRS is under fire. Yahoo Sports reported mounting pressure from lawmakers who view the tax as a deterrent to future international events. Legal experts note a potential loophole: Spain’s federation could argue the prize is not effectively connected to a U.S. trade or business. That argument is difficult given U.S. hosting duties.
Historical precedent exists. Similar taxes applied to foreign winners at past U.S.-hosted tournaments. But the scale of the $50 million prize triggers fresh debate. The U.S.-Spain tax treaty may allow a refund if FIFA is considered the payer and Spain has no U.S. presence. Courts have historically rejected “capital gain” interpretations.
Some representatives propose an amendment to exempt international sports prizes earned in U.S.-hosted events. Without a fix, other nations may demand renegotiation of hosting contracts — shifting the financial burden to FIFA or the host country.
The IRS’s claim sits in a legal gray area where tax law meets sports diplomacy. Every dollar won may not stay in the winner’s pocket.
💡 Frequently Asked Questions (FAQ)
- Q: Why is the IRS taxing Spain’s World Cup prize?
- A: The IRS considers the $50 million prize as U.S.-source income because the 2026 FIFA World Cup is hosted on American soil, triggering a 30% withholding tax under U.S. tax law.
- Q: How much will Spain lose to the IRS?
- A: Spain would lose $15 million out of its $50 million prize, receiving only $35 million after the 30% IRS withholding. Similar deductions apply to runner-up and third-place teams.
- Q: Is there a legal loophole to avoid this tax?
- A: Spain’s federation could argue the prize is not effectively connected to a U.S. trade or business, or seek a refund under the U.S.-Spain tax treaty if FIFA is the payer and Spain has no U.S. presence. However, courts have historically rejected ‘capital gain’ interpretations.
- Q: What has been the political reaction to this tax?
- A: Lawmakers like Rep. Greg Murphy have called the tax a ‘cash grab’ and ‘ripoff,’ with Yahoo Sports reporting mounting pressure on the IRS. Some representatives propose an amendment to exempt international sports prizes earned in U.S.-hosted events.
Extended Reading
Sources: Fox News (Rep. Greg Murphy quote), Yahoo Sports (political backlash), Fox Sports (third-place prize details). HA Viewpoint notes no direct involvement in FIFA or IRS policy.