No Special Tax Break for Olympic Medals

Josh Barro is the lead writer for the Ticker, Bloomberg View's blog on economics, finance and politics. His primary areas of interest include tax and fiscal policy, state and local government, and planning and land use.
Read More.
a | A

Apparently, Olympic medals come along with cash honoraria -- $25,000, in the case of a gold medal. That's income, so it's taxable.

Florida Senator Marco Rubio (R) is very upset about this, so he has introduced a bill to make Olympic income tax-exempt. He says in a statement:

Our tax code is a complicated and burdensome mess that too often punishes success, and the tax imposed on Olympic medal winners is a classic example of this madness... We can all agree that these Olympians who dedicate their lives to athletic excellence should not be punished when they achieve it.

Taxes are not punishment, and Olympians shouldn't get special tax treatment just because they are Olympians. Americans for Tax Reform has raised the issue that America is unusual in taxing its citizens' foreign income. But the Rubio bill is not about foreign income; it would apply even when the Olympics are held in the United States.

Rubio said just last week that America needs "real tax reform that simplifies the tax code." That's true. So why is he proposing to introduce a stupid new complication into the tax code? Tax reform means removing deductions from the tax code, not adding them.

(Josh Barro is lead writer for the Ticker. E-mail him and follow him on Twitter.)

This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.