Lawsuit: Former Pittsburgh Penguin Among Players Suing Pittsburgh Over Illegal Athlete Tax
PITTSBURGH (KDKA) -- The players' associations for the NFL, NHL, and MLB are suing Pittsburgh over its 3 percent tax on wages earned by visiting athletes.
They say that tax is unfair and violates state law, but Pittsburgh Mayor Bill Peduto is defending the tax.
Most people who live outside the city and work here pay a 1 percent wage tax to the community where they live and a $52 annual service tax to Pittsburgh.
But professional athletes who don't live here are charged a 3 percent wage tax on the money they earn when playing in Pittsburgh.
The athlete tax was enacted in 2005 when Pittsburgh was struggling financially.
Mayor Peduto argues it is a fair tax.
"The stadiums themselves have been paid for by the taxpayers," Peduto said. "They use them as their place of work. There was a way that we felt some of that money could be recouped for the public and we'll let the judge decide."
"The state gives us authority to be able to create certain types of taxes and this is one of them," Peduto added
The lawyer representing the players insists it is unfair and illegal.
"Athletes don't object to paying taxes," Boston attorney Steven Kidder said. "They object to paying tax completely different from any other taxpayers."
Plaintiffs named in the suit include former Pittsburgh Penguin and current player in the Buffalo Sabre's organization Scott Wilson.
He is working under a two-year, $2.1 million contract and said he paid a $6,000 athlete tax to Pittsburgh in 2016.
Former Atlanta Brave Jeff Francoeur earned $1 million from the Atlanta Braves in 2016. The same year, he paid $800 to Pittsburgh.
New Jersey Devil Kyle Palmieri is in the middle of a five-year, $23 million contract. He is suing over the $1,900 he paid in taxes to Pittsburgh in 2016.
"They have an argument that decided that it was worth kicking the tires and taking to court," Peduto said. "We think we are within our right to be able to do it."
The attorney for the players said he's won similar lawsuits in Cleveland and Tennessee.
But it could be month or years before they get on the playing field in a Pittsburgh courtroom.