The Golfdom Files: New bonanza in ’66

Cover: Golfdom

At Golfdom, we always want to know what our readers are thinking. Sending out a quick survey is one way to take a snapshot of what is on the minds of many in the industry. It seems that Golfdom has been utilizing surveys for a long time now. ¶ In 1965 golf courses received unexpected good news when the Federal Excise Tax, a tax added into products or services before sales tax, was discarded. This hidden tax often went unnoticed by consumers. Once gone, clubs could keep prices the same and pocket the profit that normally would have been eaten up by the tax… or the more noble courses could provide a discount for golfers by cutting the price. ¶ The October-November 1965 issue of Golfdom utilized a survey to see what golf courses would do with this new tax break. Would they do course renovations they previously couldn’t afford? Acquire new equipment? Add facilities such as pools or tennis courts? The possibilities opened up as the tax disappeared. ¶ To read the original three-page story, click here.

Golfdom’s exclusive survey reveals that the majority of clubs will use the excise tax savings for major improvements

America’s golf clubs are pre- paring for an all-time spend- ing spree in 1966, and the new year should mark the beginning of one of the most prosperous eras the game has ever known. These factors were clearly indicated in a recent survey conducted by Golfdom among club officials and managers to determine how the repeal of the 20 percent Federal Excise Tax on club dues has influenced future planning.

The results of the nation-wide inquiry reveal that a majority of clubs are preparing their treasuries for a new bonanza on Jan. 1, when the tax bite is officially lifted, and the bulk of this money will be appropriated for expansion, renovation and new purchases. Other clubs indicate that the tax repeal will enable them to put their books in the black for the first time in years without levying a special assessment on the membership.

Shortly after President Lyndon B. Johnson put his signature on the massive $4.8 billion reduction in excise taxes last June, Golfdom began to receive a flood of inquiries from club officials and course operators for advice on how to proceed with the collection of club dues. The 20 percent tax on club dues and initi- ation fees had been borne by club members for 22 years, and the total repeal came with startling suddenness. The most optimistic of those who had waged the campaign for its reduction had predicted that the Congress would, at best, cut it in half. Since the six-months interim period gave officials a chance to prepare for an orderly adjustment, Golfdom set out to take a sampling of reaction to the potential windfall.

Questionnaires were distributed to some 800 club presidents, managers and course operators on a basis that considered geographical location and the size and type of club.

Of the club officials responding, 64.1 percent indicated they will raise their dues to include the money formerly paid as tax; 22.2 percent will keep dues at the same level; and 13.7 percent had not reached a decision on the matter at the time of the survey. Numerous re­spondents in the last category, however, revealed that they were thinking in the direction of a 20 percent increase in dues although a final verdict had not been reached. Based on these actual survey figures and voluntary marginal notes, it appeared likely that nearly 75 percent of clubs participating in the poll would utilize the former tax money for the club treasury.