New York’s Hidden Agenda

It seemed like something that would never happen, but New York finally lifted its ban on Mixed Martial Arts. It was a hard fight for 7 years led by the UFC. The ban lift was the culmination of a seven-year effort by UFC officials, who made frequent visits to the state Capitol and retained influential Albany lobbyists in an effort to have the ban overturned. If that isn’t technical enough, the people who ultimately decide, the State Assembly, was opposed to it had a dramatic shift within their Democratic majority, which was the major factor in having the ban overturned.

With the lift of the ban, there was a light.

Madison Square Garden, long famous for being a fight event icon could not be a conquest of the UFC. Did they do it just to be nice? Haha, never, there is always a hidden agenda when it comes to politics.

New York saw it as an opportunity to cash in on a big business. Are they wrong for it? Not as long as everyone is happy including the UFC and other major MMA promotions. So what they are doing is the State of New York is levying a tax on the newly authorized sports of kickboxing, single-discipline martial arts and our baby, mixed martial arts. According to an August 18th notice issued by the state Department of Taxation and Finance, promoters of such combative sporting events will be required to pay a gross receipts tax beginning September 1st. Haven’t there always been taxes on events? Well these taxes differ from those previously imposed on boxing, sparring, and wrestling matches.

It was in April of this year that New York Governor Andrew Cuomo signed into law legislation lifting a ban on mixed martial arts contests that had been in place since 1997. The measure also imposed a gross receipts tax on the newly authorized combative sports of kickboxing, single-discipline martial arts, and mixed martial arts. The tax rates on boxing, sparring, and wrestling matches or exhibitions weren’t changed by the new law and remain at 3% of gross receipts from ticket sales and broadcasting rights, with a maximum of $50,000 in taxes per event for each type of sale. The difference is that gross receipts from ticket sales for kickboxing, single-discipline martial arts, and mixed martial arts will be taxed at a higher, 8.5% rate with no cap on taxes. The sum of gross receipts from broadcasting rights and digital streaming over the internet of such newly authorized events will be subject to a 3% tax, with a maximum of $50,000 of tax due per event.

This translates to a lot of money if the events make a lot of money. With the UFC making millions per show, you can see how this will be a huge levy due to the state. Beginning September 1st, promoters of the newly authorized combative sporting events will have to report ticket sales and pay those taxes within 10 days of the event. The taxes on broadcasts and streaming receipts generally are due at the end of the month, unless they are received during the last five days of a month. The state will be paid well and they will be paid quickly. So in order to throw shows in New York, you are allowed, but it will cost you. Fighters are constantly complaining about the minimum paydays from the UFC for the risk they take, maybe this will help them see even further that promoters don’t keep all the money, everybody wants their cut.

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