The jury is still out on the golf tax, but rumors are headed in a more encouraging direction.

Caleb Miles, president and CEO of the county's Convention and Visitors Bureau, said Thursday that the scuttlebutt emerging from legislative chambers these days hints that if a sales tax is levied on recreation and entertainment activities, it may not be applied to participatory activities.

And the term "participatory" applies to golfing, bowling, whitewater rafting and similar activities.

"It appears there may be some change in the definition of the category for the tax," Miles said. "It may be that golf will be excluded."

Miles said legislators are recognizing that things such as golf and bowling are healthy activities and people, especially in this sluggish economy, need the health benefits of recreation. This is, of course, in addition to the economic impact of the golf industry in North Carolina, estimated at $5.3 billion statewide annually.

"That tax would be hitting an industry already hurt by the recession, and it would hurt it even more," Miles said.

Miles said a considerable amount of lobbying is going on in Raleigh and hopes that some of the information disseminated will help lawmakers to make decisions that will not damage a recreation industry that directly employs some 50,000 people across the state.

One misconception has been swept away, Miles added. He said that two-thirds of the golf courses in North Carolina are public, many of which charge $40 or less for a round of golf. This means that a tax would affect people of more modest means.

"Golf is not just a country club or high-income sport," he said. "It's a sport played by all people across the state."

Miles acknowledged that this is largely speculation with "a lot of guessing going on, but there are encouraging signs."

State Rep. Jamie Boles, of Southern Pines, said the state budget situation remains in the hands of the conference committee that is working out differences between House and Senate versions of the budget. He said there is no way to know at this point exactly what is in and what is out of the budget.

Neither he nor state Sen. Harris Blake, of Pinehurst, is a member of the conference committee. Boles and Blake are Republicans.

Boles said the House version of the budget, as it emerged from the Finance Committee, did not emphasize sales taxes on services, but instead added taxes to business operations, while the Senate version was inclined in the other direction. He said the Senate wanted to lower business taxes but extend the sales tax to services, including recreation.

The legislature on Wednesday passed another continuing resolution extending budget deliberations until July 31.

Boles said he did not vote for the first resolution because the spending cap was not low enough.

However, he did vote to concur with the resolution passed this week because the spending cap had been lowered to 84 percent. The difference was just 1 percent, but he said that can make a big difference in a multi-billion dollar budget.

The proposal to extend the sales tax to services came early in budget deliberations. Lawmakers are struggling to close a billion dollar-plus gap in state revenues in order to develop a budget that will not cripple schools and other essential state services.

Contact Florence Gilkeson at 693-2479 or by e-mail at florence@thepilot.com.