Donald Trump, lover of all culture wars and hater of the National Football League (NFL) ever since his failed attempt to start a rival league, denounced NFL’s taxes, claiming that no organization tolerant of protest should receive “massive tax breaks.”
Why is the NFL getting massive tax breaks while at the same time disrespecting our Anthem, Flag and Country? Change tax law!
— Donald J. Trump (@realDonaldTrump) October 10, 2017
Trump Doesn’t Understand the NFL’s Taxes
There’s one major problem with Trump’s tweet (aside from the grammar), however: The NFL no longer receives these tax breaks and hasn’t for two years.
In 2015, the NFL’s taxes situation after the organization voluntarily gave up its 501(c)(6) tax-exempt trade organization status, which it held since 1942.
Even that status didn’t stop the NFL from paying taxes. The 501(c)(6) status, shared by the Chamber of Commerce, the NHL, and PGA Tour, did not exempt the NFL’s taxes on revenue from sponsorships, broadcast deals, and ticket sales.
Only office income remained untaxed and the NFL did not generate any such profit (a requisite for taxation) until 2012. From that point, the exemption saved the league an average of $10 million a year.
Furthermore, whereas the NFL had limited tax exemption, individual teams — those against whose toleration for political speech Trump rails — have no tax exemption.
Using Taxes to Silence Opinion
Though Trump’s fell flat for want of facts, his intent remains clear (and authoritarian): He wants to politicize taxation and tax exemption to coerce organizations into abiding by his moral and political standard.
Trump dislikes free speech, especially when the arguments presented challenge his worldview. Now that he’s president, he wants to wield the powers of the state to punish any organization, business, or individual that challenges him (see his attacks on the Washington Post owner Jeff Bezos) or the status quo.
This is a worrying precedent as it threatens ideological coercion.
Political viewpoint has no bearing on whether the IRS grants an organization tax-exempt status. This is incredibly important as it means that a conservative (or liberal) government cannot muzzle opposition by making it unduly expensive (or unprofitable) for, eg, think tanks to disseminate ideas.
The free and equal opportunity to share viewpoints — to compete in the marketplace of ideas — maintains a liberal society.
But Trump doesn’t understand these normative issues and instead contributes to the further degradation of democratic values by signaling to his followers that it is just and legitimate for the state to punish dissidents by withholding tax-exempt status for those who tolerate protest.
So much for small-government conservatism.