Vermont Nonprofits Say Ticket Taxes Will Hurt

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February 21, 2011; Source: The Manchester Journal | Nonprofits in Vermont have their fingers crossed that lawmakers will exempt them from a new law that would add at least 6 percent in taxes on tickets sold for entertainment events. In towns that have the right to add their own levy on top of the state's fee, tickets would be taxed at 7 percent.

Nonprofits fear that the law, which goes into effect April 1, would likely result in lost revenue because people will balk at the higher ticket prices. "This is not helpful because we don't have any choice [but] to raise the ticket price and pass it along to our customer," said Artistic Director for the Manchester Music Festival, Ariel Rudiakov. "The income that we derive from it (ticket sales) mandates that we have to charge a certain amount for tickets and adding to that cost does not help because we've already maxed out what we think the market will bear in Vermont. If we go very much higher you're looking at prices that are charged in New York or Boston."

Rudiakov notes that pricing tickets out of the reach of many customers will do more than just cut into sales for individual events. He said his organization in recent years has had to rely more on ticket sales to replace donations lost because of recession-related cutbacks from donors. Similarly, Steve Stettler, producing director of the Weston Playhouse, says his group is already struggling to build back audiences, which began dropping during the recession. "In this recent challenging economy most of us have made cuts and held back on any kind of price increases," Stettler said. "We'll continue to do everything we can with our own program and budgeting, but that will also be cut into if that tax goes through."

While continuing to push for the bill to exempt nonprofits from taxes on ticket sales, one of the bill's backers is wary about its prospects. "Initially the tax department and the administration were supportive, but within the last week or so they've pulled back on their support," said Oliver Olsen, a Republican state representative. "Without the governor's support it will be impossible to move this bill forward."—Bruce Trachtenberg