LINCOLN, Neb. (AP) -- Nebraska should eliminate the sales tax on entry fees for certain youth sports events as a way to promote healthier lifestyles among children, a state lawmaker said Wednesday.
"The loss of sales tax revenue is a small price to pay for a healthier state," Sen. Abbie Cornett told the legislature's Revenue Committee.
Under a bill sponsored by Cornett, city-run programs or nonprofit organizations would not have to pay state sales tax on entry fees for youth participants. Admission fees for spectators would still be taxed.
The measure comes in response to a state tax commissioner ruling late last year that said the sales tax law applies to recreational activities for youngsters.
Cornett said youth sports events for those 18 and under should be exempt from the tax. She said removing that tax burden would help more families afford to enroll their children in healthy sports activities.
Tax Commissioner Doug Ewald said Wednesday that when the Department of Revenue started examining taxes on youth sports, it found an array of interpretations.
Some groups that should have been paying sales taxes weren't paying, and some groups were paying taxes when they didn't have to pay, he said.
"It's very difficult to determine a loss of revenue," Ewald said. "There is a mixed bag going both ways."
Among the groups not paying certain taxes are the state's YMCAs.
Barbara Bettin, president and CEO of the Lincoln YMCA, said her YMCA charges sales tax on day fees for those who want to use the facility once in a while.
However, the 'Y' does not charge sales tax on memberships or for special programs such as swimming lessons or other youth sports.
If the 'Y' doesn't get the tax exemption, Bettin said, the non-profit would either have to absorb the taxes and pay from its budget, or pass along the costs to families. Another option, she said, is to cut programs.
Bettin said the need for financial assistance to join the YMCA is increasing, but she has not turned away needy families.
No one testified in opposition to the bill, but many who spoke in favor of it offered other ideas on how the matter should be handled.
Some suggested offering sales tax exemptions to all youth sports groups, including for-profit activities. Others suggested that the exemptions should be open to everyone, adults and children.
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