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Published: 7/18/2003

Jock tax bad, and could be even worse

Look, I don't want to come off sounding like an apologist for wealthy professional athletes and coaches, not when a good share of our country's population is struggling to make ends meet.

But I would suggest that the so-called jock tax requiring visiting athletes and other team employees to pay income taxes for the day of each game played in select cities housing professional sports teams is unfair taxation without representation.

Twenty of the 24 states that have at least one professional team implement a jock tax.

The jock tax is sometimes a separate tax law but it comes down to state and city governments attempting to maximize revenue from nonresidents. In this case, extremely well-paid nonresidents.

According to the 2003 report by the Washington, D.C.-based Tax Foundation, 3,574 athletes in the four U.S. professional sports earn just over $8 billion annually, an average of $2.2 million per player. By comparison, that's almost as much income earned by the 453,050 individuals in the farming, fishing and forestry industries, whose average income is $19,630.

“The jock tax began with California trying to get back at Michael Jordan beating the Lakers in 1991,” said David Hoffman, an economist with the Tax Foundation who authored the report analyzing the growing popularity of the jock tax.

California decided to extend its state income tax to Jordan and the world champion Chicago Bulls, Hoffman theorized.

“Illinois fought back with a retaliatory tax the next year,” he said.

Increasingly, sporting events are becoming more and more insignificant, irrelevant props for what really matters. Huge sums of money are spent by television networks to broadcast sporting events to satisfy a glut of companies that will pay top dollar to advertise their products before a world audience.

The trickle-down effect reaches all the way to cities doing everything within their power to squeeze taxes from the billion-dollar sports industry.

In addition to paying state jock taxes when they're on the road, visiting teams may also be forced to pay city income taxes. Cleveland, Columbus and Cincinnati all levy income taxes.

To me, the jock tax is a rip-off, akin to frivolous lawsuits filed against athletes, entertainers and celebrities because of their notoriety and wealth.

“The fact that people are being taxed because they're making a lot of money, it's definitely not good,” said Hoffman, who supports his argument with strong ammunition:

1. The jock tax is deceiving. Presented as a tax targeting super-rich athletes, it actually includes team employees with smaller incomes such as trainers, scouts, broadcasters and publicists. All employees of the sports franchises have to pay, regardless of their incomes.

2. The jock tax is arbitrary. Employees in other professions, such as doctors and lawyers who have comparable earnings, don't have to pay income taxes in every state where they may travel while working.

Also, nonresident athletes are not voters in the states levying the income taxes. Like all citizens, they can register to vote in their home states only, giving them no political voice to complain about paying income taxes in other states.

And, what if it is expanded? Unfortunately, it could reach out to other professions, including moderately paid journalists covering well-to-do athletes.



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