Manchester City propose change to New Deal transfer levy proposal

Manchester City are among a small number of top-flight clubs seeking alternatives to a 50% hike in the domestic transfer levy to help fund a landmark £1.5bn deal with the English Football League (EFL).

Sky News has learnt that some members of the so-called 'big six' - which consists of Arsenal, Chelsea, Liverpool, Manchester City, Manchester United and Tottenham Hotspur - have held discussions in recent days about modifying a proposal to part-fund the New Deal by increasing the levy from 4% to 6%.

Sources said that Manchester City had submitted a revised proposal earlier this week that would restrict the increase to one percentage point, although there is no suggestion that the Etihad club is opposed to the broader principle of a new funding settlement with the EFL.

At least one other Premier League club is said to endorse Manchester City's idea, with another club rumoured to have proposed a cap on the amount of revenue the higher levy would raise before it reverted to the existing 4% rate, according to a number of sources.

Big-spending Manchester City, who have splashed out £116m on the Nottingham Forest and England midfielder Elliot Anderson this summer, would be among the biggest contributors to the New Deal - as would the other leading names in the division.

The proposed funding mechanism involves a combination of an existing revenue ratio used to distribute income to clubs, as well as the transfer levy increase.

On Wednesday afternoon, it was unclear whether any of the six clubs would vote against the New Deal blueprint to be debated at a Premier League shareholder meeting scheduled for Thursday, although insiders said there was "confidence" that a vote would be held and that it would pass.

Premier League shareholder resolutions require 14 of the 20 clubs to vote in favour, and sources believe there is sufficient support for the deal to be formally put to the EFL.

The Premier League chairman Alison Brittain and chief executive Richard Masters met on Tuesday with their EFL counterparts, Rick Parry and Trevor Birch, to try to hammer out a deal which could be pivotal to the long-term future of English football.

David Kogan, the Independent Football Regulator's chair, and Richard Monks, its chief executive, also attended the meeting.

Manchester City's proposal of an alternative funding solution comes as the club and Premier League continue to await the outcome of their legal fight over 115 alleged breaches of financial rules.

The charges were brought in 2023.

Sky News revealed last weekend key elements of the New Deal funding package, more than three years after a financial redistribution agreement was initially mooted.

The deal would begin in the new season with a payment of less than £100m, before rising to £164m in the third year and remaining at that level until the end of the 10-year period.

Under the agreement, a new 'lifeboat fund' worth £20m would be established to assist EFL clubs which fall into administration, while a separate pot of money worth hundreds of millions of pounds over the deal's duration would be ring-fenced to ensure that EFL clubs spend 20% of the monies received for funding infrastructure improvements.

The advent of the IFR, which was conceived by the then prime minister Boris Johnson in the wake of the calamitous European Super League project, has raised the prospect of a settlement being forcibly imposed on the professional football pyramid.

One source pointed out that the prospect of regulatory intervention in the New Deal discussions would never have arisen without the European Super League having been created with the involvement of the big six clubs.

If Thursday's vote is carried, the deal will be formally put to the EFL, although it is already understood to have indicated its view that the financial terms are inadequate and will need to be improved to win its support.

Other key aspects of the deal are a gradual reduction in parachute payments which are made by the Premier League to relegated clubs over a three-year period.

One football industry source not involved in the talks said the deal appeared to be "constructed as much with the regulator in mind as the EFL".

Mr Kogan has said that the IFR being forced to step in to impose a deal would reflect "an utter failure" by English football's power-brokers.

"Going forward, it's to everyone's benefit for football to try to reach this understanding," he told an industry conference earlier this year.

"But if the leagues can't find a new deal, those powers will be enacted, and we will be looking at things such as the current mechanism for parachute payments."

Sources said the Premier League's objective was to reach a deal by the end of August, ahead of the publication of the first version of the IFR's State of the Game report, which will be released in the autumn.

The review will examine how financial flows within the game have shifted, including in relation to "cliff-edges" between or within leagues.

If a bilateral agreement can be struck, it would rank among the most significant moments in English football since the formation of the Premier League in the early 1990s.

Talks about the latest iteration of the deal come as the Premier League introduces a new financial model for clubs called the Squad Cost Ratio, which will cap their on-pitch spending at 85% of their football-related revenue and their net profit or loss from player sales.

The New Deal could also include a requirement for clubs in the Championship to transition to the same structure, according to insiders.

Manchester City and the Premier League both declined to comment.

(c) Sky News 2026: Manchester City propose change to New Deal transfer levy proposal