The NFL needs to pay its fair share

February 3, 2014

All right, now that the beer and buffalo wings have been digested and the Seattle Seahawks’ 43-8 slaughter of the Denver Broncos has been dissected, the 2013-14 football season can be consigned to the history books.

Around here, naturally, the next six months will be filled with feverish speculation on how the Steelers can rebound from a decidedly mediocre season. But before the first hunk of pigskin is launched through the air in August, lawmakers on Capitol Hill should consider the more serious business of taking away the tax-exempt status of the National Football League.

Yes, you read that right. The NFL is tax-exempt.

Last week, U.S. Sen. Angus King, an independent from Maine, announced he is joining forces with Sen. Tom Coburn, an Oklahoma Republican, to strip the NFL of its status as a 501 (c)(6) organization, which frees it from having to pay taxes on $9 billion it rakes in every year from jerseys and T-shirts, lucrative TV contracts and, not least of all, ticket sales.

The NFL argues this treasure is channeled back out to the 32 teams that dot the landscape, and the money, once it reaches that level, is taxed. But, even after all the teams, from the perennially competing New England Patriots to the never-competing Detroit Lions, get their cut, it’s not as if the employees of the NFL’s main office in New York are having to raid the petty cash drawer in order to keep the lights burning. Commissioner Roger Goodell pulled in a cool $29 million in salary in 2011. Other executives split $31 million. All told, the league itself cleared $255 million that year, even after it divided out the shares that go to the teams operating under its umbrella. The NFL is not a nonprofit. It has been, and will remain, a big business.

“When I talk to people about the NFL being a nonprofit tax-exempt organization, they’re just astounded,” King said last week. “It’s hard to say an organization that pays its executive director $30 million and yet is a tax-exempt entity – it’s hard to look my constituents in the eye and say that’s good public policy.”

A similar exemption was never granted to the National Basketball Association, and Major League Baseball gave up its tax-exempt status in 2007, with a spokesman explaining that “there was no business or other benefit for us to have the exemption, so we made the decision to relinquish it.”

As the tax code is currently written, the NFL is covered under the same rubric that includes chambers of commerce, real estate boards and business leagues.

And this would not be entirely inappropriate if the NFL promoted football in general, down to the Pop Warner level. But the NFL exists to beat the drum for the players and coaches who do battle in big-city stadiums on a handful of Sundays every year – stadiums, it should be noted, that have been built and maintained with no small infusion of public dollars.

Despite growing concern over concussions sustained by players and increasing public annoyance at owners who demand opulent stadiums and other concessions from the cities in which they are located, America is unlikely to end its gridiron love affair any time soon.

But, when it comes to paying the taxman, this relationship is too one-sided. The NFL should be doing its part and paying its fair share.



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