Oklahoma addresses state PPV tax
April 11, 2012
State Impact reports on the current status of MMA in Oklahoma. You may recall that Zuffa threatened litigation due to the state’s 4% tax on PPV purchasers within the state.
ESPN’s Josh Gross reported early last week that Oklahoma was back in business and accepting MMA promoter applications.
A little background on the subject via State Impact:
The Oklahoma State Athletic Commission doesn’t receive any state funding, and its entire budget depends of fees and licenses for combat sports events. The commission licenses professional fighters and promoters, enforces health and safety rules and oversees fighting exhibitions and competitions.
The State Impact article reports that in 2011 64% of its revenue is generated from the PPV fees. 23% of its revenue were from live fights within the state. Chart via the Oklahoma State Athletic Commission.
The Oklahoma Attorney General is reviewing the constitutionality of the law. As a result, Zuffa is holding off on filing a lawsuit until the AG makes its decision. Thus, this appears the reason why the commission continues to operate.
As of right now, SB 1533 – known as the “Oklahoma State Athletic Commission Act” – would provide the commission with $200,000 in hopes of quelling a potential lawsuit from the UFC. The money would make up for the amount it would receive from the PPV payouts. The bill passed the House of Representatives Appropriation and Budget Committee.
An interesting sidenote as most of the PPV generated in the state is from pro wrestling PPVs and not the UFC. Yet, there has not been public lobbying from the WWE (or TNA) about the tax.
SB 1533 passed preliminary committee with no opposition so if passed, it appears that the resolution may suppress a Zuffa lawsuit. Yet, it will be interesting to see the outcome of the AG’s decision on the constitutionality of the PPV tax. We will see if Zuffa presses the AG for a decision regardless of SB 1533 as a means to quash any further state taxation on PPVs.