Taxation and State Taxation -- 2017



Naifeh v. Oklahoma   (Oklahoma Supreme Court)

Whether a regulatory fee is actually a new tax

The NAM filed an amicus brief in support of Naifeh’s claim that Oklahoma Senate Bill 845 is a tax rather than a fee and must therefore be enacted following the mandated procedures. Naifeh alleges that SB 845 was intended to raise revenue; therefore, as the bill levied a tax and not a fee, SB 845’s passage did not comply with the mandated procedures. Manufacturers should not be unfairly targeted by onerous taxes imposed by states in an attempt to balance the state’s budget for the next fiscal year. The NAM’s brief argues that the fee, imposed on each pack of cigarettes, is actually a tax and as such required approval by a three quarters supermajority of the legislature prior to implementation. The court agreed with NAM’s arguments and held that as the primary purpose of the fee was to raise revenue, it must therefore be enacted following the tax-enactment procedures mandated by the Oklahoma Constitution.


Related Documents:
NAM amicus brief  (July 21, 2017)