Sucker Punch
New member
hockeyfan1 said:A financial dilemma for the Senators...?
http://www.cbc.ca/sports/hockey/nhl/story/2012/03/01/sp-nhl-senators-liberals-tax-break.html
The cash-strapped government wants to put an end to a policy that allows businesses to write off up to 50 per cent of all tickets and luxury suites for sporting events and is asking the federal Conservatives to help.
The tax writeoff also applies to other live performances like theatre and concerts and costs the province about $15 million a year.
But the Senators, which operate in a smaller market than the Maple Leafs, can't survive without the tax deduction, said team president Cyril Leeder.
"We have a sizable portion of our operation that's run based on corporate support for suites and for tickets,"
"So if we had a 10 per cent to 20 per cent loss of that business, we would be out of business."
Corporations lease 120 of the 150 luxury suites at Ottawa's Scotiabank Place, he said. About half of their season ticket holders ? who take up 11,000 of the arena's 19,000 seats ? are businesses.
And there's no waiting list for suites or season tickets, he said. If someone pulls out, there's no one waiting in the wings to take their place.
Infrastructure and Transport Minister Bob Chiarelli, a former Ottawa mayor who holds one of the city's ridings, played down the prospect of driving his home team out of business.
There are a lot of elements that determine the sustainability of the Senators, including the rise of the loonie, which is a "huge bonus" for teams that pay their players in U.S. dollars, he said.
"Certainly the governments have been very supportive in a number of ways over the years to the Ottawa Senators, the Canadian dollar has been very helpful to the Ottawa Senators," Chiarelli said.
Ontario Finance Minister Dwight Duncan sent a letter to his federal counterpart, Jim Flaherty, requesting co-operation on a list of proposed changes to the tax system.
"It is not clear that taxpayers should be subsidizing certain business expenses for income and sales tax purposes, such as private boxes and corporate seats at sporting events,"
I don't even do my own taxes, so I don't pretend to understand this stuff. Just let me know when I need to start being scared of losing my team.
A great blog post breaking it down can be found here, written by someone a lot smarter than me.