Oklahoma PPV tax declared unconstitutional
May 17, 2012
MMA Payout has learned that the Oklahoma PPV tax has been declared unconstitutional by the state Attorney General of Oklahoma. The tax has been challenged by the UFC as it threatened litigation prior to a review of the issue by the Oklahoma AG.
In an email correspondence to MMA Payout, a representative from state representative Tom Newell’s office stated that after extensive research and legal analysis of the issue, an attorney on behalf of the Athletic Commission concluded that the law could not be successfully defended.
Representative Newell is sponsoring SB1533, a bill that would grant the Oklahoma Athletic Commission $200,000 to fund combat sports in the state. “SB1533 Oklahoma Athletic Commission PPV law is assigned to a conference committee with language deleting the unconstitutional fee. We don’t anticipate having any problems,” stated Representative Newell in an email to MMA Payout. Thus, despite striking down the tax, SB1533 should pick up for the loss of the tax revenue.
Below is the fiscal analysis from the Conference Committee Report from today:
The measure deletes the State Athletic Commission’s Gross Receipts Assessment as it pertains to certain telecasts and pay-per-views. Prevailing legal opinion is that these assessments are unenforceable therefore; the measure brings current statutes into conformity with the prevailing legal opinion. The Commission expects to loose (sic) approximately $240,000 annually in revenue as a result of the assessment no longer being collected; however this fiscal impact is not a result of HB 2746, but a result of the legal determination that the assessment is unenforceable. The measure has no direct fiscal impact on the State Budget or Appropriations
MMA Payout will have more on this news in the coming days. It may have boiled down to an analysis of the Dormant Commerce Clause as it affected interstate commerce. According to representative Newell’s office, the tax had been thoroughly examined by the state’s attorneys to determine the constitutionality of the law. The good news is that based on SB1533 it looks like combat sports will continue in Oklahoma.