When it comes to tax write-offs, the breaks go hockey's way

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One of the things most admirable about the game of golf is that cheaters do not prosper.

Whereas in many other sports cheating is taught and getting away with it often applauded, golfers are expected to be their own stern and unforgiving officials.

Weekend golfers who cheat are avoided; professional golfers who call their own penalties are widely admired.

Playing fair is the one rule that matters most.

On that count, you have to have some sympathy for those Canadian Parliamentarians who think playing golf with a business associate should be treated the same as taking that business associate off to a hockey game. Bring back tax write-offs for greens fees, says the All Party Golf Caucus.

The MPs' arguments in favour of 50-per-cent tax deductions – same as applies to corporate hockey, baseball, basketball and football tickets – are not without merit. Surely it is far easier to talk business on a golf course than in a hockey rink where bad music screams from one drop of the puck to the next. And a lot more Canadians play golf than hockey.

It's only fair, they say.

So far, Finance Minister Jim Flaherty – a former hockey player while attending Princeton – has refused to entertain such a notion. And critics, who call such loopholes "boutique tax breaks," are adamant that he never allow it.

Those who don't golf, says Gregory Thomas, federal director of the Canadian Taxpayers Federation, would see it as "special treatment."

What he would rather see, if fairness is indeed the criterion, is for the government to "hunt down and eliminate sketchy tax breaks" – just as they did with those corporate greens fees 40 years ago.

The ability for businesses of any size to write off a portion of ticket costs as legitimate entertainment expenses has had a profound effect on North American sports. No write-off, far fewer, if any, luxury boxes; no coveted revenue from luxury boxes, no push to build continuous state-of-the-art facilities; no need for better revenue-producing buildings, no demand for government subsidy to build these palaces.

The end effect is that many taxpayers end up paying for facilities that put on events they feel they cannot afford to attend. It can even be argued that tax write-offs and government subsidies have played a significant role in the skyrocketing of ticket prices to pay for player contracts that years ago left the realm of sense, let alone common sense.

Thomas and his taxpayers' association have specifically targeted government subsidies going to new facilities for professional teams – "the worst tax ever invented," he says – but he knows the battle is virtually futile. It's the way things are done.

Various politicians in both the United States and Canada have talked about getting rid of the ticket tax break but, apart from reducing it somewhat, no one has ever eliminated what should never have been allowed in the first place.

Writing in The New York Times a couple of years ago, Duke University law professor Richard Schmalbeck and Jay Soled of Rutgers Business School argued that the U.S. government should move toward the elimination of the sports tax break – "essentially a huge, and wholly unnecessary, government subsidy."

Such write-offs, they argued, "are little more than an excuse for corporate executives to consume luxury items at a discount, distorting markets and cheating the public out of substantial tax revenue."

Thomas would love to see the same applied in Canada. Get rid of all such breaks for the already well-off, he says, and everyone would benefit. Tax rates would come down, everyone would have more money and, significantly, people would still fill arenas.

"The world has become a lot more affluent," he says. "I don't think we'd see six teams in the National Hockey League with the players having to take trains everywhere.

"There's no question professional sports is a highly lucrative business, but it would still be so without those insane subsidies for buildings or allowing ticket write-offs."

Thomas says there is no accessible breakdown of just what this has cost taxpayers. If the total were known, perhaps the public would demand action. But he does not expect any. For one thing, as professional teams overlap borders, the United States and Canada would have to work jointly.

If they did not, and Canada acted unilaterally, teams feeling unduly punished would use the one trick that always seems to work: the threat of going elsewhere.

"If the government were seen to be coming out against NHL and CFL tickets," he says, "the lobbying it would create would be an awesome spectacle."

It would, however, be more fair.

Which, in golf, is the way a game should be played.