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Nevada Adult Clubs Cite 1st Amendment Over 10% Tax

Nevada Adult Clubs Cite 1st Amendment Over 10% Tax
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Apr 20, 2006 10:58 AM PDT    Text size: 
LAS VEGAS — More than a half-dozen Nevada adult entertainment venues are suing the state, claiming its Live Entertainment Tax is an unconstitutional tax on an expressive activity protected by the 1st Amendment.

The suit, filed in U.S. District Court in Las Vegas on Tuesday, was initiated by the owner of Déjà vu Showgirls of Las Vegas, includes plaintiffs Little Darlings, Spearmint Rhino Gentlemen’s Club, Olympic Garden, Sapphire, Crazy Horse Too Gentlemen’s Club, Scores and Treasures.

Plaintiffs are targeting enforcement of Chapter 368A of the Nevada State Tax Code that has been on the books since July 2003 but was amended two years later. The code’s amendment was extended to clubs that are defined as “adult” entertainment establishments.

Chapter 368A grants a 10 percent tax on admission charges, food, refreshments, merchandise and entertainment fees, which includes lap dances.

The strip clubs say that the tax goes against 1st and 14th Amendment freedoms, and in particular on live exotic performance dance entertainment. They have asked the court to grant a preliminary and permanent injunction against the state for enforcing Chapter 368A, as well as refunds to some of the clubs that have made payments.

“The nonobscene performance dance entertainment establishments operated by the plaintiffs constitutes speech and expression, as well as assembly, protected by not only the 1st and 14th Amendments, [as well as articles] of the Nevada Constitution as well,” according to the suit.

At post time, plaintiffs attorney Thomas Michaelides was unavailable for comment to XBIZ.

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