NY court to decide if lap dance is tax-exempt art
ALBANY, N.Y. (AP) — New York’s highest court will consider legal arguments by a strip club on whether nude dancing is an art and deserves a state tax exemption as such.
The case set for oral arguments Wednesday involves Nite Moves, an adult entertainment club in suburban Albany that contested a tax bill of more than $124,000 following a 2005 audit.
Tax officials say sales taxes were paid on the club’s non-alcoholic drinks, but are also owed on admission and so-called “couch sales,” where patrons pay for private or lap dances.
Nite Moves claims the dances are exempt under state tax law as “live dramatic or musical arts performances.” The exemption also applies to theater or ballet. The club is relying on testimony from a cultural anthropologist who has studied exotic dance and visited Nite Moves.
W. Andrew McCullough, an attorney for Nite Moves, said the impact of the eventual court ruling probably won’t be widespread because most establishments featuring exotic dancers sell alcohol where other tax rules apply.
An administrative law judge previously agreed with Nite Moves, saying that “the fact that the dancers remove all or part of their costume … simply does not render such dance routines as something less than choreographed performances.”
But the state Tax Appeals Tribunal said the club didn’t present sufficient proof that it qualifies for the exemption, and a mid-level court upheld the tribunal ruling last year.
“In our view, there can be no serious question that — at a bare minimum — petitioner failed to meet its burden of establishing that the private dances offered at its club were choreographed performances,” the Appellate Division court ruled. The four justices also found “no merit” to the club’s constitutional claims.
The appellate court also noted that the club dancers are not required to have any formal dance training and that the anthropologist didn’t see any of the dances done in private rooms.
Cary Zeitner, a spokesman for the state Department of Taxation and Finance, said the agency is not aware of any other cases in state court similar to the Nite Moves case.
The court typically takes about a month to issue a decision.
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