PGA Tour's merger with LIV Golf could draw investigation from Congress, DOJ

The PGA Tour and LIV Golf shocked many around the sports world with the announcement of their plans to partner and, effectively, merge. There are plenty of ramifications that will come with the move — and, apparently, it could also include an investigation.

Rep. John Garamendi (D-CA) introduced a bill titled the “No Corporate Tax Exemption for Professional Sports Act” in wake of the announcement, according to Sports Illustrated’s Alex Miceli. He called the agreement between the PGA Tour and the Saudi-backed Public Investment Fund (PIF) the “Saudi Sovereign Wealth Fund’s surprise takeover of the PGA Tour” as the PIF became the “exclusive investor” in the new venture.

Garamendi is arguing against the PGA Tour’s 501(c)(6) status considering it generates an estimated $1.5 billion in revenue. He told SI the non-profit status was “outrageous, and particularly outrageous with the merger.”

“And now Saudi Arabia, who routinely sticks it to the American consumer, most recently by cutting back on the production of petroleum, which has already raised the price of gasoline in the United States,” Garamendi said, via Miceli. “I find it particularly obnoxious that they would be benefiting from this exemption with this merger, and that’s why we’re carrying this bill. We’re gonna do everything we can to end this last remaining tax loophole for professional sports associations.”

Garamendi also argued the new agreement between the PGA Tour, LIV and DP World Tour could be considered a monopoly. That’s another reason he’s arguing against the non-profit status and says the Tour should pay taxes.

“We’ve just now seen the merger of the three biggest, most prominent leagues, the PGA (Tour), LIV and and then the European Tour,” Garamendi said. “So we’ve seen the elimination of competition, we’ve now have a monopoly in professional golf. And from the point of view of a wannabe professional golfer, they’re going to have no choice. And even monopolies ought to be paying their taxes.”

Ironically, the PGA Tour and LIV Golf were at the center of an antitrust suit before announcing the plans to work together. With the announcement, which came out Tuesday morning, all pending litigation has been “squashed” as the two sides “move forward as a larger golf enterprise.”

The partnership between the PGA Tour and LIV Golf is meant to help “unify the game of golf on a global basis,” according to the announcement. PGA Tour commissioner Jay Monahan will be the CEO and PIF Governor Yasir Al-Rumayyan will be the chairman.