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Editorial: Another reason to resist the arts tax

Philadelphia Daily News
Editorial Board

(September 23, 2009) - Leave it to the geniuses of Pennsylvania Legislature to find yet a new way to rob Peter to pay Paul and pretend it's responsible lawmaking. In this case, "Peter" is education and "Paul" is . . . education. And, the robbery is accompanied by an assault on the nonprofit model for supporting arts and culture.

...New York state decided against an 8 percent tax on tickets last spring, after performing-arts organizations pointed out that a reduction in ticket sales would cause a reduction in restaurant sales, parking, lodging - not to mention lost wages from thousands of people employed in the arts. Last year, Pittsburgh finally repealed its amusements tax on nonprofit organizations because it had seriously affected its arts-and-culture scene.

The Legislature's action represents a fundamental misunderstanding of how nonprofits are supposed to work. The reason that contributions to these organizations qualify for tax deductions is that they render a public service. Some in the arts community wonder: Can a sales tax legally be levied on a tax-exempt organization? If so, are other nonprofits also are at risk of being taxed?