UT Ticket Tax Unfair, Officials Say

People purchasing tickets to University of Tennessee athletic events pay a 5 percent “amusement tax” in addition to other levies, with the revenue earmarked for the City of Knoxville and Knox County. UT officials would like to keep the money – about $1.5 million per year – for UT purposes, reports the News Sentinel.
For decades the University of Tennessee has sought to eliminate the tax.
The university, however, does not want to lower ticket prices, said Senior Associate Athletic Director Bill Myers. Rather, UT Athletics want to keep roughly $1.5 million it’s currently collecting on behalf of the city and county and use it toward planned construction projects and making up the $4 million budget shortfall the athletics department faced last year.
The tax dates back to state legislation passed in the 1940s and applies only to Knox County. The law has since been whittled down with exemptions over the years and now largely targets movie theatres outside the central business district and regular-season college athletic events in Thompson-Boling Arena and Neyland Stadium.
“We’re the only entity in the state that pays this tax — I’m talking about university athletic programs,” said Chancellor Jimmy Cheek. “Vanderbilt doesn’t pay it, University of Memphis doesn’t pay it, ETSU doesn’t pay it. It’s a state law that affects only Knox County.”
It’s an unfair tax, he said.
…Though the money is a small portion of the city’s roughly $180 million general fund budget, it’s revenue the city does not want to do without, said Knoxville Law Director Charles Swanson. If it disappears, he said, the city may have to raise other taxes to make up the difference.
City officials appreciate the value of having the university nearby and the economic stimulus that fans bring when they come to town, but it presents challenges that cost money to deal with, he said.

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