There was a time when the phrase "English player premium" meant paying over the odds for a passport. Now, according to fresh analysis of this summer's transfer window, the premium simply attaches itself to anyone already playing in the Premier League — regardless of nationality. And it is worth, on average, around £20 million.

Figures compiled by BBC Sport lay it out starkly. Premier League clubs spent an average of £39.4m on players signed from fellow top-flight sides this summer. The average fee for a player arriving from abroad was £20.2m. That near-doubling of price for a domestic move is what Kieran Maguire, professor of football finance at the University of Liverpool, bluntly labels "a Premier League tax".

The numbers that tell the story

The headline figures are striking enough, but the breakdown of high-value transfers — deals worth £40m or more — is where the structural shift really shows. Two years ago there were 13 such deals across the window. This summer there were 27. More telling is where those deals were struck. Transfers of £40m-plus between Premier League clubs trebled from six to 18. Cross-border deals with European clubs barely moved, rising from seven to nine.

Total domestic spending across all Premier League-to-Premier League business has more than doubled in the same period. The clubs outside England's top flight are benefiting too, with significant sums cascading down through the pyramid.

Former Bournemouth chairman Trevor Watkins, now working as a sports lawyer, put it plainly: the Premier League operates within its own bubble. "The revenues dwarf what other leagues generate," he told BBC 5 Live Breakfast. "A lot of deals between clubs in England — they're probably the only ones that will pay the wages or pay the fees."

The petri dish effect

Maguire identifies a structural reason why domestic fees have accelerated so sharply. Clubs outside the Big Six — he calls them "the algorithm kids" — are now scouting aggressively in international markets, signing players cheaply and integrating them into Premier League football. Once those players have proven themselves in England, the bigger clubs move in at a far higher price point.

Carlos Baleba is the clearest recent illustration. Brighton brought him from Lille for £23m three years ago. Last week he completed a move to Manchester City via Manchester United for £70m. Brighton effectively ran the risk on an unproven import, and the market rewarded them handsomely for it.

The same logic applies in reverse. Would a continental club have paid Tottenham £75m for Savio, or Everton £65m for Iliman Ndiaye? West Ham received £85m from Spurs for Mateus Fernandes. Only Barcelona, Bayern Munich and Paris St-Germain completed deals of £40m or more between European clubs this summer — seven in total across all three. Premier League clubs did 18 such deals among themselves.

Spreadsheets over scouting reports

What is driving clubs to pay such premiums within England is not just ambition — it is financial regulation. Under the Premier League's new squad cost ratio (SCR) rules, profit on player sales is now central to a club's ability to spend. Fees are amortised over contract length, meaning the accounting picture is more complex than a single headline number suggests.

The Elliot Anderson deal illustrates it well. Forest bought him from Newcastle for £35m and sold him for £116m. That is not a straightforward £81m profit on the books. With around £21m of his original fee still to be written down, the registered profit for SCR purposes comes to £95m — averaged over three years at roughly £31.7m per season for Forest.

The consequence is that clubs must chase higher fees even when reinvesting, because a bigger profit margin strengthens their position under SCR calculations. The transfer market, as a result, has become as much a game of financial modelling as football judgement. And right now, no one is better placed to play that game than the Premier League.

Frequently asked

What is the Premier League premium on transfers?
According to analysis of this summer's window, Premier League clubs paid an average of £39.4m for players signed from other top-flight clubs, compared to £20.2m for players recruited from abroad — a gap of roughly £20m that finance experts are calling a 'Premier League tax'.
Why are so many big transfers happening between Premier League clubs?
Smaller Premier League clubs are increasingly scouting and signing players from abroad cheaply, developing them into proven top-flight performers, and then selling to bigger clubs at much higher prices. Financial rules around profit on sales are also pushing clubs to generate large domestic fees to boost their spending power.
How do the Premier League's squad cost ratio rules affect transfers?
Under SCR rules, profit on a player sale is amortised — spread across several years — rather than counted as a single lump sum. This means clubs benefit most from generating large transfer profits, which encourages them to sell at the highest possible fee rather than accepting a quick, modest deal.