China to levy 100% tax on overseas football transfers

China will effectively double the cost for its clubs to buy foreign football players in a move aimed at slowing the influx of pricey overseas stars and encouraging homegrown talent.

China's Football Association announced that any club that pays more than $6.63 million for a player transfer must pay the same amount to a CFA youth development fund. The tax will be in place until the end of the Chinese league's summer transfer window on July 14. Transfers for Chinese players valued at over $3 million will also be taxed at 100 percent.

Flush with cash from corporate backers, Chinese Super League clubs have shaken up international football in recent years by offering astronomical transfer fees and wages for players from European teams.

The new policy could potentially derail mooted deals from Chinese clubs to acquire English Premier League stars such as Wayne Rooney and Diego Costa.

Cristiano Ronaldo's agent said in December that the Portuguese forward turned down an overture from a Chinese club for a transfer worth hundreds of millions of euros.

Over the past year, transfers like Shanghai SIPG's deals for the Brazilian duo Oscar and Hulk — who cost 60 million euros each — have brought a wave of attention to the Chinese league, but sports officials say the flashy purchases have done little to benefit Chinese football over the long term.

The transfer tax kitty would be spent on youth training, construction of public sporting facilities and "scientific progress in football development," according to an online statement posted by the CFA, which is non-governmental in name but effectively directed by China's state sports authority.

In recent weeks the CFA has also proposed a new rule that would require teams to play an Under-23 Chinese player for every foreign player on the field. After decades of dismal national team results, President Xi Jinping has pinpointed improving Chinese football as a top priority to boost national self-confidence and prestige.