Tax Policy & Professional Sports Organizations

I will be writing my paper about Tax Policy and how it relates to professional sports organizations. I understand that tax law and tax anything sounds (and quite frankly is) very boring, but if these organizations claim tax exemption and tax-payers are affected, it starts to hit close to home. FIFA will be the primary organization that I focus on, but I also want to discuss Major League Baseball (MLB) and the National Football League (NFL) because their relationship with taxes is more closely related to us, U.S. citizens. I will argue that professional sports organizations not only engage in tax avoidance arrangements but also influence tax policies in the domains in which they operate.

This post will focus solely on the MLB, specifically the notion that MLB teams are “looking for taxpayer dollars in order to finance new stadiums or renovate existing ones.” The article I found is from a website titled Think Progress, which is defined by Wikipedia as “a liberal American political blog that ‘provides a forum that advances progressive ideas and policies’”. Hence, this source is biased, but its information is relevant for this discussion. This article discusses the baseball team, the Kansas City Royals, and examines the team’s interest in requesting taxpayer money to repair its baseball stadium. The article even reveals that the owners of the team “paid some of their payroll tax bill with the subsidies meant for stadium improvements.” This means that the team actually used taxpayer money to pay its own taxes. What is particularly alarming about this is that the local taxpayers seem to have no voice, no ability to express their opinion on this matter.

Another source that I read was written in 1997, and discussed how the Cleveland Indians were building a new stadium. It stated that locals in the area were now paying more for alcohol and cigarettes. These price increases were due to an increase of taxes brought on by the construction of a new baseball stadium. Is it fair that a baseball team can cause tax increases? Professional sports organizations have ample effects on local economies, and often seem to get away with cutting corners. This resource will be helpful when I discuss other sports organizations, and their engagement with tax avoidance and influence.


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