A plan to tax event tickets is gaining steam
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The Detroit Tigers' Comerica Park. Photo: Roberto Machado Noa/LightRocket via Getty Images
A push to create a tax on tickets to large events in Detroit is gaining momentum.
Why it matters: Some officials and a local research organization say an entertainment tax could help shift some of Detroit residents' high property tax burdens over to visitors who use city infrastructure while enjoying live events.
- But paying more on top of already climbing ticket fees may be a tough pill for consumers to swallow.
The latest: The Citizens Research Council of Michigan (CRC) is working on drafting a contract with Detroit's government to flesh out the concept. They're looking at how to get it approved at the state level — as well as at the revenue potential and how to administer the tax locally, CRC president Eric Lupher tells Axios.
- The tax could appear on tickets for a range of event types, including games and concerts, as either a percentage or flat fee.
- The goal is to publish the report this summer.
State of play: This tax is a main policy pillar for council president and mayoral candidate Mary Sheffield.
- Council member Angela Whitfield-Calloway asked policy experts to assess the tax's potential in 2023.
- Plus, state legislators tried but failed to move bills in 2017-19, according to a 2023 report by city council's policy division.
By the numbers: The policy report estimated a 10% tax in 2022 could have netted more than $10 million in tax revenue from Lions and Tigers games that year.
- The estimate is a sliver of the city's $1.5 billion general fund. Though, for example, it would cover the $8.4 million net cost of running the health department.
- The CRC previously said the tax revenue could help the city afford to reduce property taxes.
Zoom out: Other cities don't follow a uniform model. Chicago has a 9% to 10.5% charge on viewing or participating in any taxable amusement activity — including video streaming like Netflix.
- Cleveland charges an 8% tax on admission to big games or concerts, with smaller percentages for smaller events.
- Seattle and Philadelphia tax 5% on event tickets.
What they're saying: Sen. Mallory McMorrow, who's reportedly worked on entertainment tax legislation with others, said in a statement to Axios that any proposal should tackle "junk fees" from companies such as Ticketmaster and send some of that money to Michigan communities instead.
- Ticketmaster fees vary greatly, but in 2022, the Hustle estimated recent concert fees at around 28%.