Student-athletes shouldn't be taxed likeness profits: Congressman
After the NCAA Board of Governors voted unanimously on Tuesday to allow athletes to cash in on the use of their name, image and likeness, a whole can of worms opened up, questioning how it would work when it came to taxes.
Sen. Richard Burr plans to introduce a tax on student-athlete scholarships in the wake of the NCAA vote to allow athletes to profit from their names, images and likenesses this week.
In a tweet on Tuesday, Burr, a North Carolina Republican, said if athletes are able to make money off their names and images while in school, “their scholarships should be treated like income.”
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The move would not be out of step with recent sentiment among lawmakers, some of whom are questioning whether colleges should even be tax-exempt at all. Meanwhile, the 2017 Tax Cuts and Jobs Act imposed an excise tax on the net investment income of some private institutions.
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On Friday, Rep. Mark Walker, R-N.C., joined FOX Business' "Making Money with Charles Payne" to make the case against taxation.
He's authored the Student-Athlete Equity Act, which is a bill that tweaks the definition of a "tax-exempt amateur sports organization to exclude organizations that substantially restrict a student-athlete from using, or being reasonably compensated for the third-party use of, the athlete's name, image, or likeness."
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Rep. Walker said this act would allow everyone to "have access to the free market."
"Ninety-nine percent of these student-athletes never receive a single dollar from a professional sports contract, but, in their peak earning times, they actually have to sign a ban that says 'I have no access to my image or likeness' while they're part of said university."
Rep. Walker said he strongly disagrees with Sen. Burr's taxation plan.
"Are you going to tax those at campuses that are on a music scholarship or a [educational] scholarship that are playing in a band or orchestra or using extra time, their own time, to be able to tutor?" Rep. Walker said. "These are for like backup quarterbacks or other people, whether they're male or female, to be able to have access to their image and likeness."
Rep. Walker said he doesn't want the university or the NCAA to pay up, he just wants "these students have access to the free market."
NCAA VOTES TO LET STUDENT ATHLETES PROFIT FROM THEIR NAMES, IMAGES
In October, California Gov. Gavin Newsom signed a law to allow athletes to sign endorsement deals and hire agents.
FOX Business' Brittany De Lea contributed to this report.