To wrap up a special legislative session on highway funding, Arkansas Governor Asa Hutchinson signed a measure that will generate close to $300 million over two years to help pay for upgrades to the state’s roads and...
- The Tax Policy Blog
- Donald Sterling Might Not Be Able to Write Off $2.5 Milli...
Donald Sterling Might Not Be Able to Write Off $2.5 Million Fine as a Business Expense
The California Senate Governance and Finance Committee yesterday passed a bill that would prohibit sports franchise owners from writing off fines imposed by the league as business expenses on their state income tax returns.
The law is fairly unapologetically aimed at Los Angeles Clippers owner Donald Sterling, who was fined $2.5 million by the NBA for making racially offensive comments that were uncovered in April. It would even be retroactively imposed to January 1, 2014, so Sterling’s fine would be captured.
From the Los Angeles Times:
The Senate Governance and Finance Committee advanced the bill, which applies to all sports franchise owners, but Chairwoman Lois Wolk (D-Davis) predicted that it would have trouble becoming law.
“It's really got an uphill battle,” Wolk said, adding that if the measure makes it to the desk of Gov. Jerry Brown, “I think it's going to be a hard one to get a signature on.”
Assemblyman Reginald Jones-Sawyer (D-Los Angeles) said he and Assemblyman Raul Bocanegra introduced the bill because they did not think state tax laws should reward owners of sports franchises for “behaving badly.”
Wolk voted for the bill even though she said she is concerned about singling out one private entity for a change in the tax law that has implications for free-speech rights.
Sterling is awful, and I’d love to stick it to him, but it’s a little bit weird to bring the tax code into play here. Fines imposed on franchise owners have been a mixed bag: check out this list at ESPN. Sometimes they are for totally reprehensible behavior, like when Cincinnati Red’s owner Marge Schott said nice things about Hitler, but other times they are for things that concern the league and its politics, like when Michael Jordan and Micky Arison were fined for just talking about the NBA lockout.
I suppose I’m a purist; let’s leave the league governance to the leagues, and the tax code to the legislature. Put another way, I believe in the separation of sports and state.
Follow Scott on Twitter.
Get Email Updates from the Tax Foundation
We will never sell or share your information with third parties.
Join the Tax Foundation's fight for sound tax policy Go
About the Tax Policy Blog
The Tax Policy Blog is the official blog of the Tax Foundation, a non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937. Our economists welcome your feedback. If you would like to send an e-mail to the author of a blog post, please click on that person's name to locate his or her e-mail address or visit our staff page here.
Recent Blog Posts
Related State Articles
- Lunch Links: European Delegation Visiting, Mississippi Repealing Tax on Investment, British Beard Tax Proposal
- Lunch Links: States Could Raise $5 Billion from Marijuana Taxes, Colorado Universal Health Care, Popular Governors
- Whoops! Soda Tax Petition Signatures in San Francisco Come in One Day Late
- 1 of 96
- next ›