Knox mayor seeks cuts to 'amusement tax' on UT tickets
(WBIR - Knoxville) In just a few weeks it will once again be "football time in Tennessee." Season tickets for the University of Tennessee's upcoming season have already been mailed and proudly display the phrase "I will give my all for Tennessee today" that comes from the iconic sign that hangs outside the Vols' locker room.
However, when you buy a ticket to see UT football, men's basketball, or the Lady Vols, you do not give all of your money to Tennessee. That's the case today or any other day going back to the 1940s when the state passed an "amusement tax" that adds five percent to the price of UT home games in football and basketball. The tax also applies to almost all movie theaters in Knox County (an exception was given to theaters in Downtown Knoxville).
The five percent tax is split between the City of Knoxville and Knox County. The county's portion of the tax is relatively small, only half a percent. The other 4.5 percent goes to the city.
Now Knox County Mayor Tim Burchett says the county can do without its share of the tax.
"Doing away with our portion of it, it works out to a little more than $200,000. It's not much in terms of our total budget, but $200,000 to me is a lot of money," said Burchett. "People ask me why are we doing it and I say, 'Why not?' We take enough of your money already as it is."
The Knox County Commission will discuss repealing its collection of the tax during a work session on August 18. Burchett says he would like to see the tax phased out over a couple of years.
UT Athletics has been critical of the tax in recent years. No other schools in the state have to pay a local amusement tax for their sporting events. Furthermore, no other schools in the hyper-competitive Southeastern Conference have an amusement tax included in the price of their tickets. Many SEC schools do not have to collect sales tax on their tickets. Tennessee collects a 9.5 percent sales tax along with the 5 percent amusement tax.
"We are aware that the county commissioners have placed this on the agenda for their meeting later this month," said Jimmy Stanton with UT Athletics. "We appreciate their willingness to examine this issue."
Even if the amusement tax is eliminated, do not expect UT to pass the savings on to fans by reducing the price of tickets. The school would like to keep ticket prices the same and be able to pocket the additional cash the same way its SEC competition is able to currently do.
Because the agreement was initially set up by the state, Burchett said repealing the county's portion of the tax may require the assistance of legislators in Nashville. However, any decision by the county will not impact the city's collection of the amusement tax.
The city has maintained its position that the tax is appropriate because it offsets the costs of city services such as law enforcement, security, and parking associated with large UT athletic events. The city also points out the University of Tennessee was included in the initial negotiations and agreed to the tax in the 1940s.
Burchett said he believes the amusement tax agreement in its current form was enacted to assist the university with construction of Thompson-Boling Arena.
"Those bonds and the arena, it has been more than paid back. So I think it's a good time to remove that [the amusement tax]."
The county currently uses the money collected from the amusement tax to pay for park services. Burchett said proper budgeting and natural growth in the economy can make up for those lost funds.
Sunday, January 21 2018 12:50 AM EST2018-01-21 05:50:24 GMT
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