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Supreme Court of Georgia says strip club tax is constitutional

(The Center Square) – A tax on strip clubs that goes into a fund to help child sexual exploitation victims is constitutional, the Supreme Court of Georgia ruled.

Georgia voters approved the tax through a ballot question. The collections go to the Safe Harbor Commission, which helps child exploitation victims and raises awareness of trafficking.

The Georgia Association of Club Executives said in a 2017 lawsuit the tax is unconstitutional since it is a “content-based tax” that violates the First Amendment, according to court records.

Presiding Justice Nels S.D. Peterson said that the court has often upheld complete bans on establishments that serve alcohol and allow nude dancing.

Peterson wrote in his ruling, “In this case, the State stopped short of a total ban, imposing instead a 1% tax on gross revenue on adult entertainment establishments that choose to offer the combination of nude dancing and serving alcohol. The adult entertainment establishments raised a First Amendment challenge against the tax and the trial court upheld it. So do we.”

Peterson said the case does not regulate or even prohibit nude dancing.

“The Assessment requires adult entertainment establishments that serve alcohol and operate for a profit to pay the greater of 1 percent of the 5 previous year’s gross revenue or $5,000,” Peterson wrote. “This tax is significantly less burdensome than similar taxes upheld by other courts. And it can be avoided entirely by not serving alcohol or not performing substantially nude.”

Justice Sarah Hawkins Warren said in the dissenting opinion that the tax violates the First Amendment.

She called sexual exploitation and child trafficking a “scourge on society” but said the tax is not a “lawful exercise of its authority.”

“Moreover, by recasting the state defendants’ stated interest in this case, the majority opinion has not given full effect to the test the United States Supreme Court has said must be applied in cases like this,” Warren said.

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