Inside Golf House

Golf leaders take to Parliament Hill to advocate for tax fairness

Parliament Hill (Simon Hayter/Getty Images)

OTTAWA – The National Allied Golf Associations (NAGA) took to Parliament Hill to conduct their National Golf Day and meeting with Parliamentarians to discuss the business of golf in Canada.

“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 2,400 golf courses and practice ranges in Canada and the industry contributes more than $14 billion to the GDP per year.”

While golf continues to be a favourite pastime for Canadians, it’s important to note that the small businesses involved in the golf industry have felt the impact of the weak economy over the past several years. Both participation rates and employment have significantly decreased. The outdated federal tax legislation ‎that places all golf businesses at an unfair competitive disadvantage can no longer be sustained.

“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.”

To avoid this unfair disadvantage on such an important small business industry, the same 50% deduction must be applied to expenses incurred when taking client guests to the golf course. This will not include golf memberships. Calderwood notes that the expression “more business done on the golf course than in the boardroom” is well known due to the effectiveness of client golf. “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.”

On June 1, Mr. Tilson, MP for Dufferin — Caledon, introduced a Private Member’s Bill which would allow businesses who are entertaining clients on the golf course the same 50% deduction enjoyed by competing hospitality industries.