CHICAGO -- Casey’s Marketing Co., a unit of Casey's General Stores Inc., filed a complaint March 1 in Illinois First District Appellate Court in Chicago asking the court to determine whether the state of Illinois' most recent cigarette tax increase is unconstitutional.
Defendants included Brian Hamer, former director of the Illinois Department of Revenue, and Dan Rutherford, former state treasurer.
Ankeny, Iowa-based convenience-store chain Casey's operates more than 1,900 locations in 14 Midwest states, with more than 400 in Illinois.
On June 14, 2012, the state enacted a law increasing the cigarette floor tax from 49 mills (one-tenth of a cent) per cigarette to 99 mills per cigarette—approximately 10 cents more per pack of cigarettes.
"We conclude, as the trial court did, that the statute does not violate the constitutional principle that the subjects within a class be taxed uniformly and, therefore, we affirm" the constitutionality of the statute, Justice John B. Simon said, delivering the judgment of the court.
Casey's was subject to the tax in the amount of $279,816, according to the court documents. It paid the tax under protest and, on July 17, 2012, filed a complaint seeking a declaration that the tax was invalid, demanding that its payment be refunded. The basis of Casey's objection is that the tax increase violated the "uniformity clause" of the Illinois Constitution.
"The gist of Casey's argument on appeal is that the formula used by the state for determining who owed the tax and in what amount resulted in a disparate tax burden among almost every distributor without any lawful justification," the judge wrote.
"Casey's fails to make completely clear what classification its uniformity challenge is based upon," he said.
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