When Gov. Andrew M. Cuomo released a report last month about the economic impact mixed martial arts has had on New York State since being legalized in 2016, Lawrence Epstein took great pride in the numbers.
Epstein, chief operating officer of the UFC, had spent the better part of the 21st century making this point, among others, to New York legislators.
“Everything that we told the state of New York for that nine-year period that we were fighting to get the sport recognized, legitimized, and of course regulated, has all come true and then some,” Epstein said.
The report showed that New York collected more than $7.5 million in sales tax from combat sports from Sept. 1, 2016 to Aug. 31, 2018, an increase of more than 700 percent from the two years prior.
Tax revenue collected on boxing events totaled $807,949, according to the report. The UFC has paid more than $3 million in sales tax to New York, including more than $1.55 million for the first event at Madison Square Garden on Nov. 12, 2016.
A key factor in the discrepancy is in how the sports are taxed. Boxing promoters pay 3 percent in sales tax on tickets, MMA promoters are taxed at 8.5 percent.
“It was a tough pill to swallow, honestly,” Epstein said. “There’s no other place in the country where there’s a disparity in combat sports taxes. Nowhere in the world. Wherever we go, boxing and MMA are treated exactly the same when it comes to taxes.”
After more than eight years of lobbying, the law passed the State Assembly in 2016. The tax discrepancy between the two sports became something Epstein, UFC and all MMA promoters just had to accept.
“For us, it was most important to make this product available to the fans in New York,” Epstein said. “It’s one of those things, in the political process, you sort of have to make compromises and we did.”
The UFC promoted its 10th card in New York on Saturday night at Barclays Center in Brooklyn, the company’s first event on ESPN and ESPN+. Bellator hosted two events in New York, and Professional Fighters League did four.
Revenue from combat sports in New York (boxing, MMA, wrestling), increased by 204.6 percent to more than $97 million since MMA was legalized, the report showed. The tax revenue increased more than 700 percent, in part because of the difference in how the sports are taxed.
“We’d like for that disparity to be eliminated,” Epstein said. “It’s no secret. We’re working at the legislature to do just that in this session.”