November 9, 2010

UTAH COUNTY — A group that advocates for taxpayers in Utah says the restaurant tax is unconstitutional.

Last month the Utah Taxpayers Association along with the Utah Restaurant Association filed a lawsuit against Utah County over its 1 percent restaurant tax.

Association members say customers who buy from a fast food restaurant pay 1 percent more than if they buy the same items from a convenience store. The group says the tax discriminates against restaurants and is unconstitutional.

The suit alleges that under the Equal Protection clauses of both the Utah and U.S. constitutions, taxing entities must tax similar items the same way.

Currently 28 counties in Utah assess a restaurant tax. The Utah Association of Counties says it’s a significant revenue source and losing it would be a major economic blow.

Royce Van Tassell, vice president of the Utah Taxpayers Association, told the Deseret News that if the court rules in favor of the association, his organization would partner with the Legislature and the counties to craft a fair and equitable tax to replace the lost revenue.