The issue at hand is the legality of charging a $5-per-person “pole tax” to customers of Texas’ 115 strip clubs and other adult entertainment venues, which Texas justices have decided to weigh.
The state, which has collected more than $12 million in fees that have been held in escrow pending the final outcome of the case, lost a round at court when a judge struck down the pole tax in March 2008. The state lost again in June when a state court of appeals decided the tax’s fate.
The law, passed in the 2007 legislative session, originally directed revenues collected from the fee toward sexual abuse and violence treatment and prevention programs, but it has been mired in legal challenges since it took effect.
Last year, an alternative measure was introduced that would include a 10 percent tax to those sexually oriented businesses that charge an admission fee. But the measure was postponed nine months ago.
That bill was hammered out with the help of members of the Texas Entertainment Association, an industry trade association for Texas strip-club owners.
Texas litigator David A. Furlow, who has represented businesses in numerous cases involving 1st Amendment protections, told the Houston Chronicle that the central issue of the pole tax is whether the government can levy a tax on speech.
“When you say certain types of messages and certain types of entertainment can be taxed, you begin down a slippery slope that can allow the government to destroy a form of business by taxing it out of existence,” he said.
To defend the law, the government has been forced to argue that strip clubs lead to greater violence against women, a claim for which there is no evidence, Furlow said.
The Utah Supreme Court upheld a similar law last year, ruling that taxing strip club patrons did not have the effect of restricting expression and served “an important state interest.”