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article imageOp-Ed: Pacquiao's $20 million fight purse not enough to pay Uncle Sam

By Leo Reyes     Jan 27, 2014 in Sports
Top Rank Promotions owner Bob Arum is reportedly paying eight-division world champion Manny Pacquiao a guaranteed sum of $20 million to face unbeaten WBO welterweight champ Timothy Bradley in a rematch at the MGM Grand in Las, Vegas, Nevada.
Pacquiao was reportedly getting a guaranteed sum at least $26 million on the average prior to his two straight losses in 2012 against Bradley and Mexican counter-puncher Juan Manuel Marquez.
On April 12, Pacquiao will face Bradley in a rematch that will determine who is really the better fighter between them, following a highly controversial scoring decision by the judges in their first encounter in 2012 favoring Bradley in what the public thought was a won fight by the Filipino star.
After a very impressive ring comeback against Mexican-American Brandon Rios in Macau, China last Nov. 24, Pacquiao is all set to regain his supremacy in the sports of boxing by scoring another convincing win against Bradley.
Should Pacquiao win over Bradley, his guaranteed prize is expected to soar past the $26 million mark. Another win could land him again in the Top 10 of highest -paid athletes in the world.
To some top rated fighters, Pacquiao's $20 million guaranteed prize can be a life-changing amount of money but for the fighting politician, such a huge amount is never enough.
On top of the $20 million Pacquiao is getting for the Bradley rematch, he will get a share in the pay-per-view income of the fight.
Assuming he gets an additional income on top of his guaranteed purse of say $10 million, he will end up with at least $30 million. From this amount, Pacquiao will have to pay his operating and other fight-related expenses and he would be lucky to gain a net of say $15 million which is not even enough to settle the IRS claim.
The US Internal Revenue Service has not given up on its claim of $18 million in tax dues and arrears. Pacquiao's adviser Michael Koncz said earlier that Pacquiao's US lawyers have already made arrangement with the IRS to lift the freeze order on Pacquiao's US assets. But such arrangements if true, are temporary and eventually the IRS may have to pursue its claim.
Aside from the $18 million he owes Uncle Sam, Pacquiao will have to face BIR's Kim Henares, whose claim runs to at least $50 million. While the BIR claim can be reduced substantially based on precedent-setting cases, still Pacquiao appears to be substantially indebted to both IRS and BIR.
Friends and fans of Pacquiao are hoping that the IRS won't garnish Pacquiao's entire earnings for the Bradley fight otherwise he will return to Sarangani empty-handed.
It that happens, Pacquiao's only option will be to sign a cash advance voucher from Arum chargeable to his next fight.
While Arum may be happy to give him cash advances, Pacquiao may find himself serving again as Arum's cash cow and will have no other option but to renew his contract which is due to expire by the end of the year.
This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of DigitalJournal.com
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