Wednesday, November 8, 2017
GOP tax bill's big losers: NFL, and other sports leagues
As republicans begin to push the tax reform forward, sports teams could be affected tremendously. The bill has two provisions that would cost teams, the first one eliminates the ability to deduct college donations made in exchange for tickets. The second, which is a lot more impactful is that professional sports teams would not be able to use tax-exempt municipal bonds to build stadiums. Interest payments from municipal bonds have been exempt from taxes since the early 1900's although they were not designed for the use of building stadiums. There were 36 stadiums built from 2000 to 2016, the total amount of tax exemptions for these stadiums was $13 billion which ultimately had to be payed for by taxpayers. The NFL is expected to take in $14 billion this season alone but still has taken almost $7 billion dollars from tax payers over the last 20 years. When it is explained in this way, this elimination of tax exempt bonds for the NFL seems like the right way to go but the NFL argues that "These sorts of infrastructure projects have a long history and the benefits of them are obvious in many of our communities around the country, so we will continue to make our opposition known on that."
It will be interesting to see as the tax reform moves forward the amount of push back that it gets from the NFL. I imagine with the amount of money in the NFL and other professional sports that these two provisions will be very hard to push through It is a little ridiculous that these teams and owners that have billions of dollars can't pay for their own stadiums. At the same time I understand that they feel like they are bringing a lot of jobs and stimulation to a community and want compensation (tax exemptions) for that.
http://www.foxbusiness.com/politics/2017/11/07/gop-tax-bills-big-losers-nfl-and-other-sports-leagues.html
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I think it's interesting that the NFL issue is so poisonous culturally - even when Papa Johns tried to denounce it, neo-Nazis jumped on their reasoning, and now Papa John's has spent a lot of the last news cycle trying to distance itself from Nazis, which is probably not what it intended.
ReplyDeleteInteresting article. I can understand the NFL's argument for the benefit to the community of having a nice facility however its at the residents expense. Owners of teams and the upper management of the NFL all have one common outlook, and that is to drive profits as much as they can. The proposed tax reform is threatening their profits, so arguments such as what they bring to the community will be their defense.
ReplyDeleteI expect a great deal of push back from NFL owners. Despite their deep pockets as you mentioned, they will most likely argue that the stadiums are beneficial to the public. Thus, they shouldn't have to fund the building process with their own money. It is tough to disagree with this perspective, as sports teams provide a great deal of jobs, economic activity, and pleasure to the public in their respective areas.
ReplyDeleteFirst off, great article Aunders. There will definitely be push back, even though they have billions of dollars, they won't want to spend it. After all, thats why the rich are rich. The stadiums seem to boost local economies, I don't know data on that but I'd like to think so. We will see how this goes through the tax reform, when inevitably this type of activity stimulates the economy.
ReplyDeleteThis is a very cool article. I find it interesting that even though sports teams and those organizations have billions of dollars, they do not want to put any of that towards what they do. It will be intriguing to see if the NFL can convince republicans to amend the reform for at least the next few years. What I mean by this is maybe cutting the amount of tax exempt municipal bonds the NFL is allowed to use in half or put a limit on the amount if there is not one already. That way the republicans can get some of what they want and the NFL can get a little bit of what they want.
ReplyDeleteI agree that there will be push back from the NFL and other professional sports teams. However, professional sports teams, in my opinion, should not receive tax exemption from building stadiums. Professional sports teams already charge a premium for their events and merchandise. Furthermore, professional athletes are far too overpaid for their professions. The taxes that they could and should be paying could then be used to increase the wages for people who actually deserve the money I.e. law enforcement, firefighters, paramedics, etc. Professional sports teams should not be able to ride on the backs of taxpayers dollars.
ReplyDeleteI agree w/ Duncan. professional sports team should not receive tax exemption. They are getting paid way more than they should be and I don't think its fair on others who have to pay taxes even though they are getting paid way less than the majority of the professional sports players.
ReplyDeleteAll of you guys brought up very good points and I think that these teams don't deserve the tax exemptions as well. I just find it very hard to believe that these owners who have so much money and power will allow it to change. The most realistic thing I see happening is the idea that Erin brought up about reducing the number of tax exemptions instead of completely getting rid of them.
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