TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Friday, November 30, 2018

Ohio Supreme Court: Cincinnati Reds Are Not Subject To Sales Tax On Bobblehead Giveaways

VottoCourt News Ohio, Reds Score Tax Exemption for Bobbleheads, Giveaways:

In a dispute between state tax officials and Cincinnati’s professional baseball team, the Ohio Supreme Court today quoted the team’s longtime radio announcer by declaring, “This one belongs to the Reds.” [Cincinnati Reds v. Testa, Slip Op. No. 2018-Ohio-4669 (Nov. 21, 2018)]

A divided Supreme Court determined the Cincinnati Reds were exempt from paying “use” tax on bobbleheads and other promotional items given to attendees at selected home games. The Court concluded the team successfully demonstrated that the cost of the items were factored into the cost of game tickets and counted as a tax-exempt “resale” of the items to fans.

Justice Patrick F. Fischer cited Reds announcer Marty Brennaman and several other sports figures as he delved deeply into the rich history of Ohio’s influence on professional baseball in the Court’s lead opinion. Because of the unique and undisputed evidence in the record, Justice Fischer cautioned that the ruling may not be applicable to other professional sports teams and organizations that sponsor promotional item giveaways. The Reds argued that rather than discount the ticket price to less-desirable games, the team factored a portion of ticket price to cover the costs of giveaways as a means to boost attendance.

(Hat Tip: Donald Tobin.)

https://taxprof.typepad.com/taxprof_blog/2018/11/ohio-supreme-court-cincinnati-reds-are-not-subject-to-sales-tax-on-bobblehead-giveaways.html

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