Lap Dances Are Taxable In NY

Oct 23, 2012
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Lap dances are taxable because they don’t promote culture in a community the way ballet or other artistic endeavors do, New York’s highest court concluded Tuesday in a sharply divided ruling.

The owners of Nite Moves, an exotic dance club near Albany, New York, had sought to have pole dancing and private lap dances qualified as tax exempt since revenue collected from ‘dramatic or musical arts performances’ is not taxable under state law.

But the Court of Appeals, the state’s highest court, decided against the club in a 4-3 ruling handed down on Tuesday.

The dissenting judges said there’s no distinction in state law between ‘highbrow dance and lowbrow dance,’ so the case raises ‘significant constitutional problems.’

A court ruled that Nite Moves Gentlemen’s club in Latham, New York must pay taxes because stripping and pole dancing are not considered ‘art’ like the ballet.

Nite Moves was trying to fend off a $125,000 tax bill on admission fees, beverage sales and income from private dances between 2002 and 2005. 

The owners argued that exotic dance qualifies for the tax exemption because it is difficult to perform and requires practice and choreography.

In dissent, Judge Robert Smith said that deciding the artistic merits of different dance forms ‘is not the function of a tax collector.’

‘The people who paid these admission charges paid to see women dancing. It does not matter if the dance was artistic or crude, boring or erotic,’ Smith wrote.

‘Under New York’s Tax Law, a dance is a dance.’

Andrew McCullough, who argued for Nite Moves, said on Tuesday that he is considering appealing the decision to the U.S. Supreme Court. ‘We’re very unhappy and looking at whatever options we have,’ he said.

Geoffrey Gloak, a spokesman for the state Department of Taxation & Finance, said, ‘We’re pleased with this decision, because it gives similar businesses clear guidance on the issue of sales tax when it comes to live exotic dance establishments.’

McCullough said he and his client still need to look at some alternatives, including whether to petition the U.S. Supreme Court and whether they can present better proof to the tax tribunal that the performances should qualify for exemptions.

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