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Ford seeking to exempt golf course operators from some taxes

February 1st, 2012 9:43 pm by Hank Hayes

State Rep. Dale Ford is defending his legislation to exempt Tennessee golf course operators from paying state and local sales taxes on golf carts and course maintenance items.


Ford’s bill was deferred Wednesday for one week in a House Finance Subcommittee at his request.


Ford, R-Jonesborough, pointed out state-run golf courses are exempt from paying sales tax on essential items like fertilizer.


“It’s not a level playing field,” Ford said of the taxes imposed on state-run golf courses. “We’re having problems with this economic downturn, and guys are having to close their doors. Every time they do, you’re losing 20 to 25 jobs or more.”


Tennessee’s current sales tax rate is 7 percent, while the average local option sales tax rate is 2.5 percent.


According to Ford’s bill, golf course operators would be exempted from paying sales taxes when buying or leasing golf carts, plus lawn equipment and care.


Golf course operators would be required to submit an application to the Department of Revenue for a five-year exemption.


The state’s Fiscal Review Committee noted about 150 of Tennessee’s 214 golf courses and country clubs did not have a tax-exempt status based on 2002 census data.


Tennessee’s golf courses did incur an average annual maintenance cost of $300,000. About 35 percent of that maintenance cost is considered a non-labor expense, according to the committee.


Exemptions in Ford’s bill would decrease state revenues by $486,000 and local revenues by more than $205,000, the committee also determined.


Ford’s legislation is sponsored in the state Senate by Sen. Rusty Crowe, R-Johnson City.


This year’s major tax relief initiatives proposed by Gov. Bill Haslam’s administration include a proposal to reduce the state sales tax on food from 5.5 percent to 5.3 percent, in addition to raising the inheritance tax exemption level from $1 million to $1.25 million.


For more information go to www.capitol.tn.gov. Ford’s bill is HB 2772.


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