Nick Saban and Gus Malzahn may not like the GOP tax plan (but you might)
With a most unconventional president in the White House, the current tax plan being considered in Washington is appropriately unconventional as well.
For Alabama, the plan is a mixed bag that is likely to please some but satisfy few.
College football – the sport that is synonymous with Alabama to most of the country – is strangely in the crosshairs with this tax plan.
A proposal in the plan would eliminate a deduction of 80 percent to college athletic departments for the option to purchase game tickets and obtain preferred parking, among other services. If enacted, the provision could fundamentally alter the economics of big-time college athletics.
“Some of these provisions are certainly problematic for robust athletic programs,” said Clay Ryan, the vice chancellor for governmental affairs at the University of Alabama System.
Booster programs like Tide Pride and Blazer Boosters support many non-revenue generating sports, Ryan explained. If the government alters the way they receive tax-deductible contributions, then these sports could see less financial support in the future.
Moreover, many are Title IX programs that have provided opportunity to thousands of female athletes.
The president of the Association of Public Land-Grant Universities, which includes Auburn University, also expressed his concern about the overall bill in a letter to Congressional leadership.
Another provision could directly affect the salaries of highly paid college coaches.
It would assess a 20 percent excise tax on nonprofit organizations, to be applied on salaries of those making $1 million or more.
In other words, it could cost universities millions more to compensate coaches like Nick Saban and Gus Malzahn.
Rather than causing these coaches to give up vacation homes, however, at worst the plan would likely cause the universities to employ more creative methods to pay for coaches of their revenue-generating sports.
For the rest of us making less than seven or eight figures annually, the plan should be somewhat kinder.
Low to middle-income married couples with children would see their standard deduction almost doubled to $24,400. While that sounds great, the proposal would also take away the dependent exemption, which is currently at $4,050 for each dependent.
The best selling point of the plan – according to its advocates, anyway – is a significantly lower corporate tax rate.
In a state like Alabama that has already been on an economic upswing, the lower rate could mean further corporate investment in the state and the jobs that would come with it.
Then again, all of the above is subject to negotiation in the horse-trading that is common on Capitol Hill.