The fight by the Canadian Golf industry against 45 year-old rules continues. Key stakeholders, members of the National Allied Golf Associations’, were back on Parliament Hill in Ottawa on November 29th to plead the case of their sport, and their business. Included in the NAGA delegates were Scott Simmons (Golf Canada), Roland Deveau (Golf Canada), Jeff Calderwood (NGCOA), Gary Bernard (PGA of Canada), Steve Wood (PGA of Canada) Elizabeth Di Chiara (Canadian Society of Club Managers), and Kathryn Wood (Canadian Golf Superintendents Association).
They met with members of Parliament to discuss the impact of their industry and continued to make the case that a portion of expenses related to golf entertainment should be treated by the Canada Revenue Agency as tax deductible, as is done for many other sporting activities, including hockey.
“Golf is one of Canada’s most beloved sports with more people playing the game than any other sport,” said Scott Simmons, NAGA Chair and Golf Canada CEO. “There are an estimated 5.7 million Canadian golfers and there are 2,300 golf courses and practice ranges in Canada and the industry contributes more than $14 billion to the GDP per year.”
A key focus for this NAGA effort to change the tax laws is the fact that most of those golf courses across Canada are small businesses, that they are at a disadvantage during a time when they have “felt the impact of a weak economy”, according to NAGA.
Various people within the industry also now point to a changing demographic in the golf community, noting that when the 1971 tax legislation was put into place that limited golf expense tax deductions, the sport was thought of as an elite game for the upper classes. It is now more inclusive and also has a bigger role in the Canadian economy than it once did.
“Golf is the most effective option for business people investing in client relations to generate sales and employment” states Jeff Calderwood, CEO of the National Golf Course Owners Association Canada. “The income tax act properly allows for those necessary expenses applied to all competing industries such as restaurants, concerts, spectator sports, all other participation sports, theatre, concerts and more. But client golf is not permitted due to a 45 year old section of the Act that was written at a time when golf was a small niche market for the wealthy. It’s now 2016 and golf is not only the most popular participation sport but also the most valuable client entertainment option for businesses.”
The group is seeking the same 50% deduction for expenses incurred when taking clients to the golf course that is offered to other activities. The request does not include membership costs.
To this point Calderwood notes, “more business done on the golf course than in the boardroom.” Adding, “But we can only provide those benefits if the Income Tax Act allows us an equal opportunity to all other industries”.
“The Minister of Finance is currently engaged in a review of Canada’s tax expenditures, to ensure that they are fair and effective,” concluded Calderwood. “Our recommendation is for just that: fairness. Current tax law imposes a significant burden on our industry which is already hurting from weak economic growth. We are a collection of small businesses who are simply asking to be treated fairly.”
This past summer Member of Parliament David Tilson (Dufferin) introduced a Private Member’s Bill seeking the 50% expense deduction with an amendment for the Income Tax Act.
Randall Garrison, the MP for Esquimalt, Saanich and Sooke, also introduced a similar Private Member’ Bill in 2012.
Both have not yet ended in the amendment they hoped for. As such the battle for NAGA and the Canadian golf industry to gain what they feel is equality continues…