Appeals Court: Lap Dances Are Amusement, Not Art

It's official: In New York, lap dances are not the equivalent of the ballet.

The issue came up in a closely-followed case involving Nite Moves, an adult entertainment club in upstate New York that contested a tax bill of more than $124,000.

New York collects a sales tax on admissions to "any place of amusement," including live sporting events and variety shows, but exempts "dramatic or musical arts performances" in the interest of promoting culture and arts.

Nite Moves believed it qualified for the exemption and brought forth a cultural anthropologist who studied exotic dance. It lost before an administrative law judge and appealed to the Court of Appeals for the State of New York.

On Tuesday, a decision came, and it was a close one, with the club losing by a 4-3 vote.

The majority of the appeals court panel ruled that the Tax Appeals Tribunal had not made a determination on non-exemption that was arbitrary, capricious, or an error of law. According to the majority opinion:

"If ice shows presenting pairs ice dancing performances, with intricately choreographed dance moves precisely arranged to musical compositions, were not viewed by the Legislature as 'dance' entitled a tax exemption, surely it was not irrational for the Tax Tribunal to conclude that a club presenting performances by women gyrating on a pole to music, however artistic or athletic their practiced moves are, was also not a qualifying performance entitled to exempt status. To do so would allow the exemption to swallow the general tax since many other forms of entertainment not specifically listed in the regulation will claim their performances contain tax-exempt rehearsed, planned or choreographed activity."

In dissent were Court of Appeals Judge Robert Smith and two others.

Judge Smith took a more literal reading of the law. "The ruling of the Tax Appeals Tribunal, which the majority upholds, makes a distinction between highbrow dance and lowbrow dance that is not to be found in the governing statute and raises significant constitutional problems," he wrote.

The judge, who said he found lap dances to be "distasteful," added:

"I find it clear that the Legislature used 'choreographic' in its statutory definition of '[d]ramatic or musical arts admission charge' merely as a synonym for 'dance.' Strictly speaking, it is true, not all dance is choreographed -- some may be improvised -- but it is absurd to suggest...that the Legislature meant to tax improvised dance while leaving choreographed dance untaxed."

Although the case seems unusual, it's not the first time and won't be the last time that judges are asked to weigh expression in making a tax decision. For example, a year-and-a-half-ago, in a case that has since settled, Dow Jones sued Texas for making the Wall Street Journal pay sales tax. Dow Jones argued that Texas wasn't making content-neutral tax policies on publications meant to serve free speech.

In the lap dance case, Judge Smith raised constitutional concerns. "I would be appalled...if the State were to exact from Hustler a tax that the New Yorker did not have to pay, on the ground that what appears in Hustler is insufficiently 'cultural and artistic.'"

The majority ruling didn't get into the constitutional considerations except to say the argument was "unavailing."

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