News

October 28, 2010

Is it curtains for contentious culture tax?

Controversial levy on ticket sales in arts community has been reported ‘dead’ as a budget proposal.

By Andrew M. Seder aseder@timesleader.com
Times Leader Staff Writer
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Like a great murder mystery you’d see at some community theater, an ongoing caper in Harrisburg involving the purported death of a sales tax on the admission to cultural events is being drawn out to the very last act.

The tax has been a recently introduced subplot to the ongoing drama that is the 2009-10 Pennsylvania budget negotiations.

First there was the shock caused when the out-of-nowhere tax proposal was introduced in late September. Then there was outrage and drama across the state’s theater, music and cultural landscape as word of the tax plan spread.

A plot twist drew cheers from many in the arts community last Friday when the House removed the language from its budget proposal. But the tax remained on life support in the Senate until Monday afternoon.

By 6 p.m., the proposal was deemed “dead” by various elected officials or their spokespeople.

The tax could have been detrimental to venues already struggling to make ends meet in a tough economy, according to some local members of the arts community.

“It seems to be the wrong thing to do at the wrong time,” said Michael Gallagher, manager at the Music Box Dinner Playhouse in Swoyersville. He said news of the abandonment of the tax was “a huge relief.”

The proposal would have added a 6 percent sales tax to the ticket price for cultural events and attractions including zoos, museums, plays, historical sites, concerts and more.

Estimates are that the tax would generate an additional $20 million to $100 million a year, depending on which venues were included in the legislation.

Gallagher said ticket sales have been steady, but sponsorships and donations to the 28-year-old playhouse have been lagging in recent years.

Anything that could lead to decreased ticket sales could have been a nightmare. Ticket prices are already expected to be increased $1 or $2 next year, and adding an additional $1 in taxes could have put the cost of a ticket out of reach for some potential audience members.

Gallagher and others questioned why cultural venues were targeted, especially because the overwhelming majority of them are nonprofits. While questioning that, they also wondered why other attractions such as sporting events and movie theaters were excluded from the proposal.

All of that seems to be a moot point as spokespeople in the Senate and House said the idea was unpopular and would not be part of a final budget.

“It’s dead,” said Lisa Scullen, spokeswoman for Senate Minority Leader Bob Mellow, D-Peckville.

State Rep. Eddie Day Pashinski, D-Wilkes-Barre, who voted in favor of budget plan sans the cultural sales tax last week, said in a tough budget year everything needs to be put on the table. But he felt there “were other sources that would have reaped greater benefits at a less costly price.”

He said a severance tax on natural gas extracted from the state’s Marcellus Shale formation or increased taxes on tobacco products are among them.

Brett Marcy, spokesman for House Majority Leader Todd Eachus, D-Butler Township, said “There’s no appetite for an art or culture tax by the House Democrats.” The Democrats have a majority in the House, and Marcy said the tax would not be approved by that majority. He said he couldn’t speak for the Senate.

But Mellow could.

“We are happy we were able to blow this proposal out of the water. There are other ways to raise the revenue needed to bridge the budget gap that don’t affect families and their access to art and culture. I am pleased that we were able to go in a different direction.”

While Pashinski and Marcy wouldn’t rule out the tax would be a negotiable issue and could be resurrected for a final budget, they both said they didn’t foresee that happening.

“I think this is close to being a dead issue,” Pashinski said. But he said the Senate had the ball in its court.

At a House Caucus Monday afternoon, he said he walked away feeling confident the proposal was off the table but added a caveat.

“The way things have gone, you never know what they’re going to do,” Pashinski said.

And the performance continues.

Andrew M. Seder, a Times Leader staff writer, may be reached at 570-829-7269.

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