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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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slide1

ENTERTAINMENT EXPENSE LOBBY

golf as an allowable

business expense

Presented by: Jeff Calderwood, CEO

NGCOA Canada

slide2

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
slide3

Entertainment Expense Lobby

2013 Federal Budget Update

  • 2013 Budget did not address business golf
  • Continued effort required
  • Did remove tariff on golf equipment
slide4

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
slide5

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
slide6

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
slide7

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
slide8

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
slide9

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
slide10

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
slide11

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
slide12

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
slide13

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
slide14

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
slide15

Thank You

All the best for the 2013 season!

Jeff Calderwood, CEO

NGCOA Canada

613-226-3616

[email protected]

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