Alerts and Updates

Illinois State Tax Update

January 23, 2017

January 2017

The Illinois Supreme Court in Hertz Corporation, et. al. v. City of Chicago ruled unconstitutional the expansion of the Chicago personal property lease transaction tax to vehicle rentals in the Chicago suburbs when a Chicago resident was involved. The court held that the city did not have extraterritorial jurisdiction to regulate and tax the suburban rentals based on a mere presumption that a Chicago resident may have used the car in the city after the rental.

In Iwan Ries & Co., et al. v. City of Chicago, the Illinois Cook County Circuit Court held that the new Chicago tobacco products tax on cigars and chewing tobacco was illegal. The court concluded that a state law passed in 1993 specifically preempted this new tax and held that the city’s argument that its passage of a cigarette tax prior to 1993 somehow legalized the passage of the new tobacco products tax was contrary to the wording of the law. 

December 2016

The U.S. District Court for the Northern District of Illinois dismissed a case brought against Dunkin’ Donuts and its Illinois franchises for a violation of the Illinois Consumer Fraud Act. In Bartolotta v. Dunkin’ Brands Group, Inc. et al., the court held that there was no violation of the Illinois Consumer Fraud Act in the collection of Illinois sales tax on coffee bag sales, because the franchises were either collecting tax correctly or they had a reasonable interpretation of the law.

[Note: Duane Morris represented parties in the three cases discussed in this Alert.]

For Further Information

If you would like more information on how this may affect your company, please contact Stanley R. Kaminski, any other member of the State and Local Tax Practice Group or the attorney in the firm with whom you are regularly in contact.

Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.