Owners of bowling alleys, golf courses and race tracks in the state are not amused with a proposal by Gov. David Paterson to put a first-ever sales tax on their admission charges.
The proposal, contained in Paterson’s executive budget, would include their operations under a new definition of “amusement” and make them subject to state and local sales taxes. “I think it is a very bad idea. In the long run, it would hurt low- to moderate- and fixed-income people,” said Mike Scaccia, owner of Boulevard Bowl on Erie Boulevard in Schenectady.
For his business, the sales tax on admission charges — essentially a charge on every game of bowling — would amount to 8 percent: 4 percent for state sales tax and 4 percent for the county sales tax. The total tax would differ county by county, based on the local sales tax component.
“That would be devastating if it were 8 percent,” Scaccia said. “I am paying energy costs and real estate taxes on the whole building, even though I use 20 percent of the space,” he said.
Matt Anderson, of the governor’s Budget Office, said local sales taxes would apply to admission charges under the proposed amendment. The tax would affect only for-profit amusement centers. Nonprofits such as Proctors and Schenectady Light Opera Company would be exempt, he said.
Anderson held out hope that some of the governor’s proposed taxes — he did not identify which ones — would not be imposed as a result of the state’s receiving $24.6 billion in federal stimulus money. Legislators are debating the governor’s budget; they are required to adopt a budget by the start of the fiscal year April 1, though this has been late many times.
Paterson proposed the taxes as a way to help close an estimated $14 billion deficit in the state budget for 2009-10.
Kathy Leitgeb, executive director of the New York State Bowling Proprietors Association, which represents 200 out of 312 commercial bowling centers in New York, called the governor’s proposal harmful to small business.
“Most of the businesses are family-owned and we are an industry already hard-hit by many state mandates, such as the smoking legislation, and by competition with gaming centers,” Leitgeb said. “A sales tax is something we can’t absorb and we don’t want to pass it on to our customers. We have heard many people say they would quit bowling if there was a sales tax on their games.”
The sales tax would also affect New York’s ability to attract professional bowling competitions, Leitgeb said. “There are only a handful of states across the country that charge sales tax on bowling. In this area, only Vermont charges a sales tax,” she said.
Leitgeb said the sales tax would cost the state money, not generate revenues for it. “Because of the decline in revenues, bowling center proprietors will not invest in their businesses,” she said.
John Lee, of the New York Racing Association, which operates Saratoga Race Course, Belmont and Aqueduct, said the racing industry is already heavily taxed and another tax would hurt.
“There is an admission tax that municipalities charge. All betting is taxed. NYRA pays the state a regulatory fee annually and there are sales taxes generated through food and souvenirs,” he said. “We are a heavily taxed business.”