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Emanuel’s amusement tax change could cost high rollers

High rollers willing to cough up big bucks for tickets to sporting events and hit shows like “Hamilton” could find themselves paying higher prices, thanks to a subtle change tied to Mayor Rahm Emanuel’s 2017 budget.

Just when die-hard Cubs fans are turning to StubHub, VividSeats, TickPick and TicketLiquidator for tickets to the National League Championship Series and the World Series, Mayor Rahm Emanuel wants to change the way the city’s 9 percent amusement tax is applied to “ticket re-sales.”

“Ticket resellers are currently required to remit the five percent or nine percent amusement tax, depending on the type, on ticket mark-up only, resulting in difficult calculations and loss in tax revenue,” the mayor’s budget overview states.

“As part of the 2017 budget, the city is proposing to simplify the amusement tax rate on ticket re-sales to a flat 3.5 percent on the full resale price, regardless of the mark-up. With this proposed simplification, the city anticipates a slight increase in revenue as tax remittance will be easier for ticket re-sellers.”

On StubHub, tickets for Game 1 of the NLCS were going for anywhere from $370 for standing room to $10,000 for dugout boxes.

A 3.5 percent tax applied to the full resale price of $10,000 would add $350 to the cost of the ticket. For the $370 standing room ticket, the new tax would be $12.95.

Chicago levies a 9 percent amusement tax on movies, concerts, sporting events, live theater and entertainment venues with a seating capacity of more than 750.

A lower rate of 5 percent applies to live theatrical, musical and cultural performances in smaller venues with fewer than 750 seats.

The change impacting ticket resales is not the first time Emanuel has tweaked the amusement tax to boost revenues.

Two years ago, he reduced and then eliminated entirely the amusement tax exemption that had long benefited cable television companies to offset their franchise fee.

The $12 million plan cost the average cable customer $2.40 more per month and $28.80 more per year.

The mayor’s budget also seeks to eliminate what City Hall calls an obsolete exemption that affects motorists who drive downtown and park their vehicles in private garages.

“There is currently a minimum threshold of $2 for 24 hours, $10 for weekly and $40 for monthly parking below which the parking garage tax does not apply,” the budget document states.

“The city seeks to eliminate this exemption for the majority of parking garages, while leaving the exemption in place for government-owned and operated lots, specifically the CTA, Park District and other government buildings.”

In yet another change, the Commission on Animal Care and Control will change the “redemption fee” it charges dog and cat owners to reclaim lost animals picked up by the city to “mirror the current adoption fee.”

Currently, Animal Care charges “different fees for pet redemption based on a variety of factors” plus a housing fee of $8 a day for as long as the lost dog or cat remains in the city’s care.

The new redemption fee will be $65 — same as the adoption fee — and the daily housing fee would be abolished.

The change is expected to be “revenue neutral” while allowing pet owners to “more affordably and quickly redeem their pets,” the budget overview states.

Parking ticket scofflaws and other deadbeats also will be hearing more from City Hall, to deliver on Emanuel’s promise to raise $16 million next year by dramatically improving enforcement of taxes, fines and fees and collections on outstanding debt.

The city’s Department of Finance plans to start sending “two additional notices” to parking ticket and water bill scofflaws and other deadbeat, either by email or postcard.

One notice will arrive before fines are doubled. The other will come before the names of tax and fee delinquents are referred to a collection firm.

A closer reading of the mayor’s $8.2 billion budget also includes some other interesting revenue tid-bits:

• Revenue from ground transportation taxes is expected to fall nearly 13 percent short of the $60.8 million projection this year and generate only $54 million in 2017.

“While the ride-share industry continues to expand in Chicago, more recent policy changes along with consumer preferences have impacted the amount of revenue collected from the $5 surcharge on ride-share vehicles,” the budget overview states.

• The city is in line for a $40.5 million windfall, thanks to the tax-increment-financing surplus that funneled $87 million to the Chicago Public Schools.

• Revenues from Chicago’s highest-in-the-nation cigarette tax of $7.17 a pack is down nearly 8 percent, to $19.9 million, even though the tax is now applied to e-cigarettes.

The city blames the drop on the decision to raise
Chicago’s smoking age from 18 to 21; tax tobacco products other than cigarettes; and prohibit coupons and discounts used to lure another generation of smokers to take up the deadly habit.

• Revenue generated by concessions, rental fees, airline rates and charges are expected to rise dramatically — by roughly $100 million at O’Hare Airport and nearly $40 million at Midway Airport — thanks to an ongoing concession overhaul and other developments at both airports. The Department of Aviation is adding 221 full-time employees to oversee the surge in airport projects.

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