UW System Position on Bills Introduced in the Legislature During the 2005-2006 Session
(Montgomery) creates an income and franchise tax credit in an amount equal to the sales tax paid on the right to purchase season tickets to athletic events sponsored by higher education institutions.
Referred to: Committee on Ways and Means
UW System Position
SUPPORT: Currently University of Wisconsin athletic departments collect sales tax on their sales of admission tickets to University sporting events. For men’s football, basketball, and hockey, and women’s basketball at UW-Madison, the UW-Madison Athletic Department requires a minimum donation to the Badger Fund to obtain seating in certain areas of the Kohl Center and Camp Randall Stadium for these events. There is also a required donation to the Phoenix Fund for certain seats for men’s basketball at the Resch Center at UW–Green Bay. The Department of Revenue has taken the position that the minimum donations are subject to sales tax under sec. 77.52(2)(a)2, Wis. Stats., despite the fact that the donations are treated as charitable gifts to the University under the income tax laws.
The bill is necessary to offset the negative impact to University donors and the University if sales tax were to be imposed on these charitable donations to the Badger and Phoenix Funds. Without the proposed credit, it is expected that University donations would decline, requiring athletic departments to increase ticket prices or take other measures to compensate for the expected shortfall in donations.