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Margins tax back before Supreme Court

Yet another challenge to that unloved tax.

The Texas Supreme Court [Friday] accepted a case that will decide whether the state improperly administers its business tax.

Nestle USA argues that the tax violates the Texas Constitution’s requirement that taxes be levied in an “equal and uniform” manner, as well as the U.S. Constitution’s equal protection and due process protections.

The court dismissed a similar claim earlier this year, ruling that Nestle lacked standing because it had not yet paid its taxes. Nestle recently renewed its challenge after paying its taxes under protest.

With the legislative session set to begin in January, the Supreme Court set an accelerated schedule for the case, with oral arguments to be heard Sept. 18 – a day previously set aside for a court conference, or private meeting with the nine justices.

Last year the court upheld the margins tax as constitutional in a separate case filed by Allcat Claims Service LP. Assuming this is on the same mandated 120-day schedule as that case was, we ought to have a ruling by the opening weeks of the 2013 legislative session. That will be right around the same time as we get an initial decision in the school finance lawsuits, though those will still have to be appealed to the Supreme Court afterward. My head hurts already thinking about what next year is going to be like.

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