We can think of few business groups less deserving of another tax break than professional sports team owners. They already operate under favorable laws written specially for them - and many of them profit from facilities built with tax dollars. So it would take a lot of nerve for Congress to pass another windfall for sports titans.
Actually, it took sneakiness more than nerve. Without hearings or debate, both houses of Congress added a one-sentence tax write-off for sports franchises to a 900-page tax bill that was already so irresponsible Sen. John McCain called it a "Christmas tree of goodies for every conceivable special interest." The bill gives tax breaks to a long list of businesses, including race tracks, malls, distilleries, Oldsmobile dealerships and, now, sports teams.
The Senate and House have passed versions of the bill that differ on many points, except this one. In both bills, team owners would be allowed to take a tax write-off on the full value of all newly acquired assets over 15 years. Owners had already been allowed to amortize player salaries, but under this proposal they could write off lucrative media contracts, as well.
The value of the new tax break could total $2-billion, experts who specialize in sports banking told the New York Times. Some team owners might even be able to use their team write-offs to lower their tax bill on other businesses they own. The main impact, however, is that the new treatment would raise the value of the teams when they are sold.
Teams with the highest broadcasting revenues would benefit most, which is probably why Major League Baseball lobbied for the change and the National Football League supported it, while the National Basketball Association and National Hockey League (whose teams have smaller media contracts) remained neutral. Some teams, particularly those in the minor leagues, might actually lose value under the proposal.
The two houses are supposed to work out their differences over the bill when they return from recess, but Americans would be better off if lawmakers threw the whole mess out and started over. At a time when the nation is struggling with record deficits and other threats to economic growth, it is immoral to give billions more to those who need and deserve it least.
