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Tennessee's "Jock Tax" under review; UPD: Repealed by Legislature

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07-28-2013, 08:56 AM
  #1
LadyStanley
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Tennessee's "Jock Tax" under review; UPD: Repealed by Legislature

http://www.tennessean.com/article/20...nclick_check=1

Quote:
Representatives for the [NBA] Memphis Grizzlies, the National Basketball Players Association and the National Hockey League Players’ Association appeared at a hearing in Legislative Plaza on Tennessee’s “jock tax,” a surcharge of $2,500 per game levied on pro basketball and hockey players.The state’s jock tax has become a widespread gripe among NBA and NHL players, in part because the proceeds go to team owners. They also say the tax — by some measures, the highest in the U.S. or Canada — means players at the bottom of their league’s pay scale wind up paying more in taxes than they receive in wages for playing in Tennessee.
“Because of this tax, 43 percent of the players in the league have to pay out of pocket when they play in Tennessee,” Mathieu Schneider, a 20-year NHL defenseman who now works for the players’ union, told state lawmakers. “If other states in the U.S. and other provinces in Canada decided to tax hockey players in the same fashion, the National Hockey League as we know it would cease to exist.”
...
Proceeds from the privilege tax go to the Nashville Predators to subsidize operations at Bridgestone Arena and the Grizzlies to subsidize the FedEx Forum in Memphis.
Predators officials did not attend Thursday’s hearing. NHL owners agreed as part of the most recent collective bargaining agreement to work for the repeal of Tennessee’s jock tax.
Grizzlies' spokesperson was there to defend the tax.


NFL is exempt.


Last edited by LadyStanley: 03-26-2014 at 01:21 PM.
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07-28-2013, 09:57 AM
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What the ****. I want to hear the rationalization for exempting the NFL.

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07-28-2013, 10:35 AM
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Originally Posted by Fordy View Post
What the ****. I want to hear the rationalization for exempting the NFL.
as do I ... with a little digging http://deadspin.com/5503841/tennesse...-sympathy-here


Last edited by Dave is a killer: 07-28-2013 at 11:09 AM.
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07-28-2013, 11:27 AM
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^^^

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Oh, and why are the Titans and their opponents exempted? The NFL has rules that would penalize the state if its players had been affected. Showing once again that the NFL is more powerful than the Tenth Amendment.
http://deadspin.com/5503841/tennesse...-sympathy-here

How does this make any sense? What "rules" does the NFL have that can penalize a state government?

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07-28-2013, 12:02 PM
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Originally Posted by Fugu View Post
What "rules" does the NFL have that can penalize a state government?
The only thing I can think of is its tax exempt status at the federal level not only supercedes state & municipal taxation but so too carrys with it penalties should they try to enforce their own codes & requirements. Heres more on that...

www.sportsonearth.com/article/48849938

http://www.forbes.com/sites/peterjre...-meets-the-eye

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07-28-2013, 12:30 PM
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Originally Posted by Killion View Post
The only thing I can think of is its tax exempt status at the federal level not only supercedes state & municipal taxation but so too carrys with it penalties should they try to enforce their own codes & requirements. Heres more on that...

www.sportsonearth.com/article/48849938

www.forbes.com/sites/peterjreilly/2013/06/01/nfl-as-tax-exempt-less-than-meets-the-eye

This would apply to the NHL and NBA, iirc. The league level revenues are passed through to the member teams, after appropriate deductions for 'fees' and the league office expenses.

It just seems bizarre that if you wanted to grab cash, you wouldn't go after teams with 50+ members on the roster. Friends in high places perhaps?

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07-28-2013, 12:51 PM
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Originally Posted by Fugu View Post
Friends in high places perhaps?
I believe so, from Georgetown through to most state capitols, counties & or municipalities and for a good 5 decades, really ramping up through the 70's & 80's. Transcends just stadium development & sport, politics, other business interests involved, some on a global scale as you know.

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07-28-2013, 01:55 PM
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Originally Posted by Killion View Post
I believe so, from Georgetown through to most state capitols, counties & or municipalities and for a good 5 decades, really ramping up through the 70's & 80's. Transcends just stadium development & sport, politics, other business interests involved, some on a global scale as you know.
Looking at this portion of the article again, I think the cities are taxing the players from the teams/leagues getting the benefits:
Proceeds from the privilege tax go to the Nashville Predators to subsidize operations at Bridgestone Arena and the Grizzlies to subsidize the FedEx Forum in Memphis.
Predators officials did not attend Thursday’s hearing. NHL owners agreed as part of the most recent collective bargaining agreement to work for the repeal of Tennessee’s jock tax.
It's almost a clever way to get 'subsidies' from the players for the subsidies going to the teams. It's a weird Catch 22 if you then consider that subsidies can be considered as HRR, and thus a portion of that going back to the players collectively. The PA got the NHL to agree to work on repealing this, but it's really in the league's interest to have it come from other tax streams (e.g., citizens and businesses).

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11-01-2013, 10:31 PM
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NHLPA preparing to sue the state of Tennessee over "Professional Privilege Tax"

Quote:
The NHL Players' Association is seeking permission to sue the state of Tennessee on behalf of its membership and get reimbursed for a special tax that players must pay each time they play a game in Nashville.

Since the 2009-2010 season, the state has taxed NHL players $2,500 - with an annual cap of $7,500 - under a 'Professional Privilege Tax' each time they were on their club's playing roster for a game in Nashville.
http://www.tsn.ca/nhl/story/?id=435638

Of note, the current CBA actually stipulates that the NHL reimburses players for the tax, so the reimbursements would only go to the players that paid the tax prior to the shortened 2012-13 season if the NHLPA is successful. As the NHL is paying for it currently, they're also supporting the player's association on trying to get the tax repealed as well.

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11-02-2013, 04:12 AM
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No reason to exempt the NFL and not the NHL. I hope the NHLPA win the court case and stop the players having to pay it.

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11-02-2013, 04:19 AM
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I think other states and provinces should just tax the Tennessee players who come to town

BTW

There are several states who tax players from other cities who play in their state--only difference is that it is all pro players and not just hockey or BB players

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11-02-2013, 07:30 AM
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This could ugly in the courts in a hurry. Any chance the NFL gets pulled into this to explain how they have the power to "penalize" states on a legal, monetary level while all others have to submit to pay?

This could get interesting.

As I read about the NHL/players aspect of it-wow-hadn't thought of that.

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11-02-2013, 10:22 AM
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Quote:
Originally Posted by bozwell View Post
There are several states who tax players from other cities who play in their state--only difference is that it is all pro players and not just hockey or BB players
And I think that's one key here.

You are not taxing equally. The NFL is a special (excluded) case.

If there were a MLB, NLL or MLS team in the state, I'd guess that those unions would also be upset their players would be imposed the tax.

Also, many other jurisdictions get their income via **income tax**, which applies to resident and visiting teams.

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11-02-2013, 11:30 AM
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Not fair if you ask me. Tax all the sports and not leave the NFL out.

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11-02-2013, 01:00 PM
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Quote:
Originally Posted by bozwell View Post
I think other states and provinces should just tax the Tennessee players who come to town

BTW

There are several states who tax players from other cities who play in their state--only difference is that it is all pro players and not just hockey or BB players
Quote:
Originally Posted by LadyStanley View Post
And I think that's one key here.

You are not taxing equally. The NFL is a special (excluded) case.

If there were a MLB, NLL or MLS team in the state, I'd guess that those unions would also be upset their players would be imposed the tax.

Also, many other jurisdictions get their income via **income tax**, which applies to resident and visiting teams.
In every other state (that I know of) there is not a special "Jock Tax". Visiting athletes/entertainers are simply subject to the states' regular Non-Resident Income Tax - owed by all persons who earn above certain thresholds in that state. In those cases it's up to each state tax board to define how that in-state income is defined (ie the CA FTB pro-rates allocated income based on the # of games played in California).

The problem with Tennessee is that they have no regular state income tax (only a tax on interest & dividends) - and implemented a special tax only on visiting athletes and with unequal treatment.

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11-02-2013, 05:00 PM
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Quote:
Originally Posted by No Fun Shogun View Post
http://www.tsn.ca/nhl/story/?id=435638

Of note, the current CBA actually stipulates that the NHL reimburses players for the tax, so the reimbursements would only go to the players that paid the tax prior to the shortened 2012-13 season if the NHLPA is successful. As the NHL is paying for it currently, they're also supporting the player's association on trying to get the tax repealed as well.
Reading the comments section on there you would think that Bettman was the Governor of Tennessee and passed this tax to keep teams from moving to Canada. FYI: Alberta charged the same tax in the 90's to help the Oilers and Flames and it was upheld

http://www.cbc.ca/sports/hockey/arbi...l-tax-1.370474

Also Winnipeg proposed a similar tax as a way to help get the Jest to return.


Last edited by Gnashville: 11-02-2013 at 05:36 PM.
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11-02-2013, 07:26 PM
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Quote:
Originally Posted by kdb209 View Post
In every other state (that I know of) there is not a special "Jock Tax". Visiting athletes/entertainers are simply subject to the states' regular Non-Resident Income Tax - owed by all persons who earn above certain thresholds in that state. In those cases it's up to each state tax board to define how that in-state income is defined (ie the CA FTB pro-rates allocated income based on the # of games played in California).

The problem with Tennessee is that they have no regular state income tax (only a tax on interest & dividends) - and implemented a special tax only on visiting athletes and with unequal treatment.
My brother drives long haul in the states and he only pays tax in the state he lives and gets paid in

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11-03-2013, 02:59 AM
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How much money does Tennessee bring it from this scheme? From the NHL alone it is something like $1.5 million per season.

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11-03-2013, 09:19 AM
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Originally Posted by 0point1 View Post
How much money does Tennessee bring it from this scheme? From the NHL alone it is something like $1.5 million per season.
And even that sum can be put to a lot of use around the city/region. Fixing potholes, perhaps half a dozen police officers, fire fighting equipment.


(Not saying it's going to waste)

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11-03-2013, 10:11 AM
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What a ridiculous tax. Hopefully the NHLPA wins. Will be interesting to see how the crappy conservative politicians in TN spin justification for this tax.

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11-03-2013, 10:16 AM
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Quote:
Originally Posted by bozwell View Post
My brother drives long haul in the states and he only pays tax in the state he lives and gets paid in
I hire drivers all the time and it doesn't matter where they live it matters where the work is done.

When I send one of my guys up to Chicago to work, he earned that money in Chicago and has to pay Chicago taxes on it.


Last edited by triggrman: 11-04-2013 at 05:55 AM.
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11-03-2013, 02:49 PM
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Is it just me or could is this the kind of case that could go to the Supreme Court?

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11-03-2013, 04:51 PM
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Is it just me or could is this the kind of case that could go to the Supreme Court?
SCOTUS? Yes.

All depends on if appeals get that far AND court is willing to hear it.

(Guessing limiting "Interstate commerce" basis of SCOTUS appeal)

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03-26-2014, 01:20 PM
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http://www.law360.com/articles/52162...fl-nhl-players

Quote:
Tennessee lawmakers took initial steps Tuesday to repeal a controversial tax that the state collects from National Basketball Association and National Hockey League players and then passes on to the owners of the Memphis Grizzlies and Nashville Predators.
Behind $$ wall for rest of article. I'll be watching The Tennessean for further stories as well.

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03-26-2014, 05:40 PM
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What's the chances that it's money is paid back to the players? Slim to none?

Especially in the cases where the player didn't travel there and still had to pay it

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