Ruling Could Enforce Collection of Pole Tax in Strip Clubs

Categories: Courts

PoleTax560.jpg
Photo courtesy of The Colorado
After a legal fight waged for more than five years, it looks like strip-club-going might in fact cost a little more here in Houston, the Mecca of strip clubs (can we really say that?).

After the state supreme court ruled against a challenge from the Texas Entertainment Association that said the $5 pole tax was limiting First Amendment rights, a lower court has now ruled against another challenge saying the tax went against the Texas Constitution.

The reason, said TEA lawyers, was that the tax was an occupation tax, but the appeals court ruled it an excise tax. As it goes, the $5 fee is charged to every customer and then paid by the clubs to the state every quarter. At least that was the idea since 2007.


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Google Maps
There's a $5 pole tax you need to be paying.
According to a report on Bloomberg.com:

The tax, expected to generate about $30 million per year starting in 2008, was intended to fund sexual-assault programs such as prevention and services for victims, and other health-care initiatives. So far it has generated about $17.2 million, R.J. DeSilva, a spokesman for [Texas Comptroller Susan Combs], said in an e-mail.

"If the clubs had been paying it all along, they wouldn't be in a bind now," said Annette Burrhus-Clay, executive director of the Austin-based Texas Association Against Sexual Assault, which represents 80 rape-crisis centers. "Most patrons plan to spend more than $5 before they go into a club."

If you're one of those types who like to "make it rain" at the strip club with a wad of singles, just know that the little money stack might be a little smaller now if clubs are following the rules. There's a possibility the ruling last week could be appealed to the state supreme court.


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6 comments
steve1red
steve1red

You can find pimps and drug dealers at strip clubs. They're the ones who look suspicious and all the girls flock to them. They like to make deals in the lap dance area or the non-smoking patios outside.

Pimps like to recruit at strip clubs. They either do it themselves or have women recruit for them.

whitesites
whitesites

Taxing stripclubs isn't so much the problem. The problem is in how they are doing it.  There are many times when stripclubs need to do things to promote such as free cover, just to get people in the door.  Once people are in a seat, I think it should be fair game to apply a 1% tax to the customer's Tab.  This way the tax is more consumption based.  Trust me the 1% would add up quickly with the 4 figure tabs I have seen.   

Richard Cameron
Richard Cameron

I don't think taxing a business is unfair as long as the tax is applied to ALL businesses and not just ones that are arbitrarily selected based on non-existent evidence, religious prejudice and intolerance.

theOnce
theOnce

Why doesn't my local cafeteria or sports bar get extorted for a similar fee that's earmarked for a similar nice-sounding organization?




EnosCabell
EnosCabell

@theOnce  I'm guessing that your local cafeteria isn't as large a nexus for drug abuse, human trafficking, and tax evasion as the average strip club. (If I'm wrong about that, let me know because I've been looking for a good party cafeteria!)


Strip clubs are a much larger drain on municipal services than your average business when you cost in health, law enforcement, and lost tax revenue, so it makes sense to recover some of those costs in an excise fee.


It's the same reason that we tax cigarettes, but not orange juice.

CLEM
CLEM

@EnosCabell @theOnce

Ok, then if the fees are to offset the cost of extra law enforcement (the others you mention are incorrect)  why is the money being given to a non-profit group? Why not reimburse the municipality?

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