There is more on the line in Game 6 than just the Larry O’Brien Championship Trophy. If Golden State doesn’t close out the NBA Finals in Cleveland, everyone in the Cavaliers’ organization will have to pay California’s “Jock Tax” for Game 7. While Cleveland abolished the jock tax last fall, California has the highest version of the tax at 13.3%.
For two decades, states and municipalities have been levying a “duty days” tax on traveling professionals which has become known as the “jock tax” since it applies most visibly to professional athletes. The tax is calculated by the number of days that an individual spends in the state whether it be for practice, games, or meetings.
21 states and 8 municipalities have jock taxes. Everyone who travels with a team is forced to pay. That means even benchwarmers who are paid the league minimum are forced to pay the tax. In some instances, these players are losing more money from the tax than they earn in salary.
While some athletes struggle under the weight of the tax, it has an even larger impact on the people who travel but are not on the roster. Positions including the trainer and equipment manager are charged the same flat tax simply for being affiliated with a traveling sports team. Not only are the fees burdensome for staff who are often paid at the national average income, but they are also forced to file taxes in 15 to 20 different states each year. This forces them to seek out accountants since the tax can best be described as “a puzzle that needs to be assembled by a professional.”
The tax conflicts with the very reason for American independence: taxation without representation. Since workers are taxed by places where they only visit for a few nights each year, they cannot vote on the taxes or the representatives who administer them. The politicians are using the jock tax as a way to easily grab money without upsetting the constituents who have the power to vote them out.
The jock tax has made news recently as a settlement between the National Basketball Players Association and the city of Memphis made the city pay out $2.38 million of the $7.27 million that it collected since its tax began in 2009. This could be the beginning of the end for the jock tax.
Even while this seems to be a victory against the jock tax, the same professionals who are most hurt by the tax are left out. While the low earners do not have the funds to pay out a large portion of their salary each night, they also cannot afford legal representation to challenge the tax and ensure that they are reimbursed.
Other cities and states should look to the Memphis example and see the irrationality and injustice of levying such a devastating tax on the young men and women who are pursuing their version of the American Dream.
Photo Credit: Erick Drost