Good day, Sunday! I trust your weekend is going well. Monday is likely to be a wake up call in the financial markets as smart money begins to anticipate the real possibility of an all out trade war between China and the USA. Considering the drop just last week, some experts predict that the Dow Jones Industrial Average might fall as much as 5,000 points in the next month.
Now is a good time to put your money into safe havens…like under your mattress. The bubble is about to burst as fear of reality sets in.
Paco’s Poker Nightmare
I have been following this story since it broke last week when Paco Vallejo, Spain’s strongest chess player for almost two decades, unexpectedly withdrew from the European Individual Championship in Georgia.
On his FACEBOOK he explains why, and since then a number of Spain’s leading MSM news outlets have picked up the story. For those readers who don’t read spanish, Chess.Com has a pretty good english summary of the situation.
Apparently many others are caught in the same web as Paco as the Spanish tax authorities are enforcing a now defunct clause (2012) for anyone who won money in online poker prior to 2012.
According to Paco, he started to play poker as an amateur around 2010 but didn’t make any real money and so he desisted towards the end of 2011. HOWEVER, while he did not make any money, the Spanish tax authorities hit him several years later with a 500,000 euro tax bill for the money that he actually won (not counting his losses, ofcourse, which were greater)!
Under the new law (since 2012) Paco would not have to pay anything, as his losses would be subtracted from his winnings, and then he would only have to pay taxes should there be a net gain. The government, however, is enforcing the old law for those who should have paid taxes , but didn’t, before 2012.
It is a tough situation for Paco. The government is not desisting, and have forced him to spend thousands of euros on legal fees just to stay out of jail, so far. The government has also taken whatever money he holds in Spanish banks.
All of this has affected Paco’s health and has forced him to cut down his chess playing to a bare minimum. He says that he can not concentrate anymore, and this explains why he left the European Championship last week.
The backdrop to all of this is that the spanish government has been recently aggressively going after football players and coaches for tax fraud. Christian Renaldo, Messi and Mourinho are just some of the celebrities that have been forced to pay tens of millions of euros in unpaid taxes to avoid going to jail.
The big question is what is going to happen to Paco. He does not have the money that the Spanish government wants him to pay, and once the legal process comes to an end, there might only be Paco spending time in jail. Sad.