UEFA are reportedly set to to reveal proposals next month which would see Financial Fair Play rules replaced by a salary cap and luxury tax by next year.
The current FFP system which was introduced 11 years ago, state that clubs must break even over a three year period.
Under the planned system as reported by the Times, clubs participating in European competitions would be limited to spending a fixed percentage of their revenue - said to possibly be around 70 per cent - on salaries.
Any clubs found to breach the cap would have to pay a luxury tax in which the 'equivalent or more' of any overspend would go into a pot to be then redistributed to other clubs in the competition.
The proposals are set to be unveiled a conference on the future of European football that UEFA is hosting in Switzerland next month.
UEFA's meeting will involve figures from national associations, leagues, clubs, players and agents.
The salary cap would allow wealthy owners to spend beyond their club's income but only if they are willing to pay the luxury tax if they go over.
The news comes just days after Paris Saint-Germain announced the signing of their latest world superstar in Lionel Messi following his shock departure from Barcelona.
Messi signed a two-year deal in which he is set to earn a whopping £1m-a-week at the French giants.
He joins other big name stars including Kylian Mbappe and Neymar at the Parc des Princes.
In the future, if a big name signing like Messi was to push a club over the salary-cap threshold, they would have to pay a substantial amount extra to bring that player in.
Repeat offenders would also face possible sporting sanctions in the proposals, which could be anything up to a possible disqualification from European competition as UEFA looks to provide a deterrent to stop clubs overspending.
It's said the luxury tax would be on a sliding scale where exceeding the cap by up to 20 per cent could mean clubs pay the equivalent amount of the overspend, but for anything over that it could be 1.5 or two times the amount.
The proposals adopt a similar system already seen in the United States in both Major League Baseball and basketball's NBA.
UEFA's meeting will also discuss how to fend off the threat of any future breakaway European Super League.
The Premier League's 'top-six' as well as six other major European clubs including Real Madrid, Barcelona and Juventus, announced plans for a super league back in April.
The ESL’s plans collapsed when nine of the 12 founder clubs, including the six English ones, pulled out only 48 hours after it was launched due to public anger.
Though the remaining trio of Real Madrid, Barcelona and Juventus are still involved in court proceedings against Uefa and still hope to push through the plans.