Should Wicomico County Subsidize Crown Sports Center?
October 8, 2008 by Cato
Filed under Maryland, Taxes, Wicomico Politics
As reported in this morning’s Daily Times, the Crown Sports Center is asking Wicomico County for some relief from the Amusements and Admissions tax. Is this a valid request, or just another stab at corporate welfare?
You would probably guess from the title and first paragraph that I’m opposed to this proposal. You would be wrong. At this point, I’m pretty agnostic about the whole thing.
Why?
Let’s examine a few questions:
- Is this a corporate subsidy?
- Is this corporate welfare?
- Is it bad public policy?
- Is it fair?
Is this a corporate subsidy?
Absolutely. If other businesses have to pay the tax for similar transactions, then there is no question that this is some type of corporate subsidy.
Is this corporate welfare?
See above. The tax was in place when the owners started their business. Now they suddenly realize that they owe the tax and want relief? Again, if other business that engage in similar activity are subject to the tax, then any relief SPECIFICALLY for Crown is nothing more than corporate welfare.
Is it bad public policy?
Yes … and No. Again, if Crown is the only business to receive relief, this is bad public policy. It is my understanding that bowling and tennis are currently exempt. What about paintball? Look, I don’t participate myself, but I understand that there are teams and leagues.
Why should bowling and tennis receive a subsidy? Why add soccer and lacrosse? If all similar activity would receive relief, then this is good public policy. Mr. Hearne shouldn’t have to pay a tax when his “competitor” down the street who owns a bowling alley doesn’t have to. Similarly, Crown should not receive a tax exemption if the paintball facility at the other end of town doesn’t. (Again, I’m just using this as an example. I’m not representing the paintball lobby.)
Councilwoman Stevie Prettyman makes a good policy argument that IF an exemption (or rate reduction) was given, that it should only be given to youth leagues. Of course similar arguments could be made adult leagues as well. You know, get people active. Fight obesity.
It sure beats the ridiculous argument by Councilman Bill McCain:
This is the gem for the Delmarva Peninsula,” said Councilman Bill
McCain. “Anywhere I go on the Shore, people are talking about Crown.”
So? Should the county taxpayers subsidize everything that Bill McCain’s crowd thinks “is a gem”? I think I heard similar arguments about the zoo and the old mall project. Showing his true liberal stripes again, McCain falls into the trap of arguing from feelings rather than ideas.
Is it fair?
Well, I guess that will be up to the Wicomico County Council and County Executive Rick Pollitt. The argument for exempting youth leagues is strong (from a public policy standpoint), but not especially compelling. It also has nothing to do with fairness.
If the county is interested in fairness they basically have two options:
- Reduce or eliminate the tax for all business that are engaged in similar activity.
- Keep the tax rate as is, but remove the current exemptions for acivities such as bowling and tennis.
I think it is bad public policy.
I have never been to Crown myself, but I know many people who have and from what I have seen from the vast amount of activity from the outside, it looks to me as if this has become an asset to the community.
From a business point of view when you have an asset in your community, more money comes in, more money is spent at existing business’s and therefore everyone benefits.
I take issue with the categorization of this being corporate welfare.
Bringing in business and not being penalized for doing so makes for good government.
I disagree with these types of taxes period.
I also disagree with inventory taxes, equipment taxes, tax abatement’s and the like.
This only encourages dishonesty and, keeps corporate eyes set on more favorible enviroments.
It is a shame that governments rely on this type of stuff to pay for their existence. It only proves how un-necessary most of the crap that they provide is.
I spent last month in Wyoming, and was so refreshed by the business environment there. They are so happy for anyone to come and do business there and welcome you with open arms, with no personal income tax and no corporate taxes.
Sales tax is the same as here, and no state inventory tax.
They offer no stupid incentives to more there because they are so friendly there is truly no reason to do so.
I think more states need to rethink there policies as they are just pushing people out and discouraging entrepreneurs.
I am in the same pickle as Crown Sports Center. I own Delmarva Paintball and I too have a large A&A tax due.
7 years ago, when I moved my business from Laurel, DE to Salisbury (what was I thinking)I spoke with a representative from the MD comptrolers office about taxes. Not once did the A&A tax come up. I hired a bookeeping firm and an accountant. They too were uninformed about the A&A tax. So, unknowingly I did not charge my customers this tax for years.
Until… Like Crown, I had an audit. Everything else was in order but I recieved a huge bill with penalties and interest for years of A&A tax.
I’ve been trying to figure out what it is for. Why do some business have to pay it and others do not? Neither I nor my customers get any benefit from it. It seems to just be a random tax on random businesses.
Am I for Crown Receiving tax relief? Yes, but Delmarva Paintball should get the same.
I have been to Crown, and I am familiar with the “sport” of paintball. I think the real focus should be whether a facility that hosts both youth and adult sports is amusement or fitness. Soccer and Lacrosse are valid sports that kids can play starting from toddler ages through high school and college. These are REAL competitive sports that give children and adults the opportunity to become more physically fit. More so than bowling and tennis (which are apparently exempt from this tax). It is beyond me why a facility that offers such a service should be taxed in such a way. Team sports should not be taxed as amusement. By not allowing an exception for Crown, the fees for children to play indoor soccer and lacrosse will most likely go up and make it so many of them will not be able to afford it. I really don’t think this was what intended focus of this particualar tax.
Scott,
I think you miss the point. It’s not about whether Crown is a “worthy” business. Government has no business making a decision like that. It’s a legal business. The county has chosen to levy that particular type of business with a certain type of tax. I’m all for repealing the tax. I just don’t think that the tax should be repealed just for Crown.