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Illinois Court Rules Against Tax on Strip Clubs

Illinois Court Rules Against Tax on Strip Clubs
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Dec 24, 2007 1:00 PM PST    Text size: 
CHICAGO — A state appellate court has ruled that Chicago and Cook County cannot collect amusement taxes from an exotic dance club when other small venues are exempt from the tax.

The 1st District Appellate Court in Chicago wrote Friday that although the city and county had exempted other small, live performance venues from paying the tax, it had not exempted clubs with nude dancing, which was "content-based regulations on speech that do not serve a compelling state interest and, therefore, violate the 1st Amendment."

The decision was written by Judge Margaret O'Mara Frossard on behalf of a three-judge panel.

The city of Chicago and Cook County passed ordinances in 1999 that exempt small venues from paying the city tax of 8 percent on tickets and the county's tax of 3 percent.

The exemptions, which specifically did not include "adult entertainment cabarets," were intended to assist music clubs and theaters that hold fewer than 750 people.

Pooh-Bah Enterprises Inc., owner of the Crazy Horse Too club, filed suit against the city and county in 2001 claiming the ordinances were unconstitutional because they singled out strip clubs based on the content of the entertainment offered.

A trial judge ruled for the city and county in 2005, but Friday's appeals court ruling reversed that decision.

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