High U.S. Tax Rate Forces Boxer Manny Pacquiao to Fight Overseas
Boxer Manny "Pacman" Pacquiao has decided his next boxing match will take place overseas because of the high United States income tax rate.
The former pound-for-pound champ who, along with Floyd Mayweather, is one of the sport's biggest draws, will try to make a comeback after being knocked out of his last bout against Juan Manuel Marquez last December. But he will do so in Macao so he does not have pay 39.6% on what will be millions of dollars of earnings for the fight had he fought in the United States.
Pacquiao will fight in Macao on November 24 (the fight will air live in primetime on HBO on November 23 in the United States) against Brandon Rios.
Months after Pacquiao's last fight in December of 2012, President Barack Obama and Congress, to avert the so-called fiscal cliff, let the Bush tax cuts expire and raised the top income tax rate to 39.6% for individuals and families making $400,000 and $450,000, respectively.
As Breitbart Sports reported, Pacquiao indicated shortly after the top tax rate was raised that he would prefer to fight in Macao, which does not have an income tax. The top tax rate in the Philippines, his home country, is also lower than America's.
According to ESPN, this will be the first time Pacquiao has fought outside the United States since 2006, and promoter Bob Arum said America's top income tax rate was determinative in Pacquiao's decision.
"It's a big deal because the tax rates in the Philippines are much lower," Arum said.
Pacquiao ndorsed Nevada Sen. Harry Reid, a Democrat, in 2010 and was instrumental in helping him get re-elected. The Senate Majority Leader supported increasing the top tax rate, and now Reid's home state will take an economic hit because Las Vegas will not be able to host Pacquiao's next fight.