Macro Economical Tendencies for Sport Sponsorship Development

Pilinkiene Vaida and Komskiene Diana

Academic Journal of Interdisciplinary Studies, 2016, vol. 5

Abstract: Organization of sports policy priorities and responsibilities are very different in all Member States, with implications on the flow of financial resources to the lowest level, public financing and sport sponsorship. Sports sponsors return on investment generates benefits for the economy as a result of increased activity on sports events, infrastructure development as well as for employment, quality of life or state and city image formation, creating soft power prospects, generating state competitiveness, more revenue from sports tourism, leisure and other sales sectors. All interested parties are funding sport directly and indirectly. For example, companies pay corporate taxes, which generate income to government, which can invest in the sport. However, the government can also define a fiscal framework that is conducive to private companies investing in the sport, such as tax relief. The goal of the article is to reveal the problems of sports funding system on the theoretical basis for sport sponsorship integration. Results indicate, that sports sector in the EU countries limited by the legal framework and the tax burden when the tax ratio is the demand and supply elasticities regulator. On the other hand, a decrease in costs for sporting events or activities of the organization to obtain more funding for sport, modeling macroeconomic legal and tax environment, can provide more opportunities for return on investment for sponsors within the larger media publicity contracts, licensing business expansion, thus generating more sales for sponsors, ensuring higher tax collection in the budget, the growing GDP and social capital development.

Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:bjz:ajisjr:1558

DOI: 10.5901/ajis.2016.v5n3s1p128

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