Legal Commentary

The state of Tennessee last year enacted a Professional Privilege Tax on Professional Athletes, taxing home and visiting NBA and NHL players $ 2500 per game, up to three games. (H/T: Deadspin, via FIU student Wes Plympton). Detroit Red Wings Captain Brian Rafalski has objected to the tax, noting that seventeen teammates who make in the $ 500,000 range (minimum NHL salary) end up losing money on the days they play in Tennessee. Proceeds from the tax apparently go to the municipality to fund various public parks/recreation projects. Interestingly, the NFL is exempted from the tax because the league had an existing rule that would penalize any state that attempted to impose such a tax. Minor league players are exempted as well (the original proposal covered only players making $ 50,000 or more).

It is easy to criticize this, as one commentator does, as a money grab targeting a vulnerable group. After all, no one is going to have sympathy for the group Rafalski is trying to protect--players making half-a-million dollars and having to pay $ 7500.

But dig deeper. The tax is expected to raise more than $ 1.1 million a year for municipal programs. The players are potentially playing in a publicly financed arena on which the state and local governments will not recoup their financial investments, so it is hard to blame the city for trying to get some fiscal benefit out of the deal.

I do wonder whether there is an Equal Protection problem here--not in singling out professional athletes, but in exempting the NFL. Is there a rational basis for taxing two leagues and not the third? Is avoiding a penalty from the NFL a rational basis?

Tax prawfs?