Bonnaroo ticket tax now on hold
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Matheny said he doesn’t like the idea of taxing the tickets, but said he felt obligated to Coffee County commissioners after they requested a 5 percent privilege tax to cover costs associated with the event. Last year, 80,000 tickets were reportedly sold.
“As a state representative, I have a fiduciary responsibility to take that act and give it proper consideration before the General Assembly. As a citizen of Coffee County, I think it’s a bad idea,” Matheny said Monday after Warren County’s Legislative Breakfast.
“Number one, I think it’s going to push it away. It also sends a very detrimental message to other festivals and other businesses that would want to come to Coffee County that we’re a hostile environment for anybody that does well.”
Matheny said he believes local business licenses should have been required of Bonnaroo vendors in the past and Coffee County Mayor Ray Johnson concurred. Matheny said from what he understands, vendors will be required to have business licenses in the future.
Johnson said as an example of the problem that in the past, vendors may have had business licenses from other areas and then paid the accompanying sales taxes in those counties where they had business licenses.
“Now maybe we can get some sales tax off the merchandise sold out there and we should,” Johnson said.
And since the privilege tax proposal brought considerable opposition from state legislators, and others wondered about taxing other types of entertainment, the bill was sent back to committee.
As it stands, Matheny said, business licenses will be required, and Bonnaroo leaders have also agreed to donate to Coffee County.
“The $300,000 plus that we think we would get by implementing it [business licenses] next year, along with the roughly $300,000 that Bonnaroo has agreed to match to the county, would be more than what the 5 percent tax would be,” he said.
For now, the privilege tax is out of the picture.
“It won’t happen this year for sure. Next year, I don’t think it’s going to pass, to tell the truth, because it’s been taken off the floor and referred back to Finance, Ways and Means Committee, which it basically has to come through the committee process from beginning to end,” he said.
“The state wants to listen to the Commissioner of Tourism and the other representatives and study the fiscal impact, both negative and positive, that this act would have on the state and any precedent that it might set,” Matheny added.