Rhode Island Seeking 25 Percent Adult Tax
Rep. Elizabeth M. Dennigan has drafted a bill that would place a 25 percent tax on all products and services sold at adult-oriented businesses, including tangible goods sold at video stores as well as food, drinks and lap dances at strip clubs.
Dennigan says she is trying to find creative ways to raise revenue for the cash-strapped state and that money raised from the new tax would be earmarked to fund treatment programs for sex offenders and prosecution of Internet predators.
Beyond being creative, Dennigan and her supporters in the legislature admit that adult entertainment is an easy target for a number of reasons, including “that the public might not have as much of an issue” with a tax that only hits adult businesses and their patrons.
The bill’s co-sponsor, Rep. Fausto C. Anguilla, brought up secondary effects arguments, which claim that adult businesses bring crime to the neighborhoods where they operate and said adult products are “frivolous [and] not essential.”
“It's always an easy industry to target in an election year,” Angelina Spencer, executive director of the Association of Club Executives, said, adding that it would provide politicians with a convenient distraction from real issues. She did add, however, that such a tax could have one silver lining: legitimizing adult businesses once and for all.
Dennigan’s proposal prompted the executive director of the Rhode Island chapter of the American Civil Liberties Union to issue a statement calling any tax that singles out one type of business, such as adult entertainment, unconstitutional.
Dennigan admits that she has not done enough research on the issue to be sure the tax is a “good idea” or whether it is constitutional.
Similar measures have been proposed in Utah, Kansas, Washington and Missouri.