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ENTERTAINMENT EXPENSE LOBBY. golf as an allowable business expense. Presented by: Jeff Calderwood, CEO NGCOA Canada. Entertainment Expense Lobby. Now is the time to RIGHT THIS 42 year old WRONG !. Golf is not permitted as a client entertainment expense deduction

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ENTERTAINMENT EXPENSE LOBBY

golf as an allowable

business expense

Presented by: Jeff Calderwood, CEO

NGCOA Canada


Entertainment Expense Lobby

Now is the time to RIGHT THIS42 year old WRONG!

  • Golf is not permitted as a client entertainment expense deduction

  • All competing industries are allowed a 50% deduction

  • The Income Tax Act influences businesses to avoid golf

  • Golf is one of the best client entertainment options

  • Golf courses cannot sustain this unfairness any longer

  • We demand an equal 50% allowable business expense deduction

  • Once fixed, more corporate golf will be played


Entertainment Expense Lobby

2013 Federal Budget Update

  • 2013 Budget did not address business golf

  • Continued effort required

  • Did remove tariff on golf equipment


Entertainment Expense Lobby

Strategy

  • Persuade Finance MinisterFlaherty to amend the Tax Act

  • NAGA leadership on behalf of entire golf industry

  • Impact Public Affairs engaged to manage the lobby

  • Golf Awareness Days on Parliament Hill


Entertainment Expense Lobby

Strategy

  • Supporting media campaign

  • Meet with all MPs individually

  • Pre-budget consultations with Deptof Finance

  • Chamber of Commerce & CFIB support will now be engaged


Entertainment Expense Lobby

Key Messages

  • Golf is a vital industry, not just a great game

  • 6 million golfers; #1 participation sport

  • 70 million rounds played; 2500 golf courses

  • $11.3 billion direct economic impact ($37 billion indirect)

  • 155,000 direct employment (340,000 indirect)

    • 43% are students

  •  $3.1 billion in total property & income tax

  • Over $400 million in charity fund raising

  • Golf businesses are small businesses; 52% less than $1.5 million gross


Entertainment Expense Lobby

Key Messages

  • Golf deserves equal and fair treatment

  • Tax Act singles out golf at 0% deduction

  • All other recreation/entertainment/hospitality industries are 50% deductible

  • Examples: NHL, CFL, NBA, MLB, theatre, skiing, tennis, restaurants

  • Accountants advising businesses to use NHL, etc instead of golf due to tax disadvantage

  • Golf can’t compete fairly without level taxation playing field


Entertainment Expense Lobby

Key Messages

  • Income Tax Act is supposed to be built upon fairness

  • Golf is a better tool for building client business than any other

  • Not right that the Tax Act penalizes one small business sector

  • Golf courses have had declining corporate revenues

  • Not asking for a tax break for golf courses; deduction applies to the business paying for the client

  • IRS in the USA treats golf equally to all competing industries

  • Golf is not an elitist sport; avg 18 hole green fee is $35

  • Golf courses today far different than 1971 tax reform decision of 0% for golf


Entertainment Expense Lobby

Our ‘ASK’

  • Amend section 18.1 of Income Tax Act to include golf at 50%

  • Golf will then be treated fairly with all competing industries

  • Applies to guest fees and cart rental only

  • Does not apply to memberships

  • Incremental golf will be played by the corporate sector

  • Employment, taxation and overall growth in golf industry will be stimulated


Entertainment Expense Lobby

Potential Objections

  • Why not eliminate tax deductions for all businesses?

  • Yes, that would correct the unfairness, but not realistic

  • Entertaining clients is a critical cost of developing business

  • Would discourage anyone from opening a business in Canada

  • We’d lose most NHL teams & many other entertainment industries

  • Flaherty on record saying he wouldn’t do so

  • Just a ‘red herring’…return to the real discussion of the need for 50%

  • All growth in golf industry will be stimulated


Entertainment Expense Lobby

Potential Objections

  • Won’t it cost Gov’t too much when we’re trying to balance budget?

  • Projected net lost tax revenue is $20 million

  • To Flaherty’s $260 billion budget, it is insignificant, basically revenue neutral

  • Incremental golf played will drive additional tax revenues

  • To the golf industry, the incremental gross revenues will be a huge impact


Entertainment Expense Lobby

Your Role

  • Meet with your own MP

  • State the case for golf deserving fair tax treatment

  • Tell the MP that we are meetingwith all 308 MPs across Canada

  • Use your own business as a local example within that riding


Entertainment Expense Lobby

Your Role

  • Request a letter of support from MP to Flaherty

  • Request that the MP follow up with a conversation with Flaherty

  • Request ongoing support from the MP

  • Report meeting outcome back to Impact Public Affairs


Entertainment Expense Lobby

Supporting Material

  • Download your Grass Roots Advocacy Kit at

  • www.ngcoa.ca or www.canadagolfs.ca

  • Consult with Jeff Calderwood or other NAGA directors or Impact Public Affairs


Thank You

All the best for the 2013 season!

Jeff Calderwood, CEO

NGCOA Canada

613-226-3616

[email protected]


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