Citrix claims total tax exemption under First Amendment

by Matthew Gast

Related link: http://www.law.com/jsp/article.jsp?id=1039054470520




Citrix, which is headquartered in Ft. Lauderdale, Florida, is suing to get a refund of all the state corporate income taxes paid over the last several years. (Their lawyer also says that he is considering adding the IRS as a defendant to the suit, but it's hard to see what effect that would have in a state court lawsuit.) The proposed legal theory is that information and communication companies have a Constitutional right to free speech, and taxing speech has a chilling effect on that freedom. Ergo, any company that helps process information or enable communication should not pay income tax.




According to the story, a spokesman for the Florida Department of Revenue laughed when asked to comment on the lawsuit, and said that the DOR is looking forward to the pending litigation. A law professor noted that "crackpots" usually file suits like these, and is suprised that a large company would make such a broad claim to tax exemption.




Attempts to get other companies to join the suit do not appear to be going all that well. The Miami Herald declined to participate, but it won't say why. The suit currently includes their customers, who must "opt out" to refrain from participating.




According to Citrix's attorney, the lawsuit is not related to a dispute with the state over a $90,000 R&D tax credit, and that the company doesn't "want this [lawsuit] to be seen as big business trying to save money."




Update (1/22/2003): Eric Albert notes that Citrix has dropped their suit.



4 Comments

anonymous2
2003-01-04 07:37:02
Citrix
It is my understanding, based on local knowledge, that the Citrix suit will stand, as ordinary citizens, as intervenors in a class action, understand that the lions share of the claim is not income taxes--it is the state sales taxes on software, newspapers, magazines,and access to weblogs, which includes your foolish article, that they will pursue (it was their money, anyway). The reasons for the anti-sales tax issue is that (1)none of the above qualifies as tangible personal property (it is intangible property under Florida Law) and (2)the first amendment is not invoked here to protect the company, but to protect the taxpayers from whom the corporation, as agent for the state, collects the sales tax money, which is an abridgment of their freedom of speech.


If you read history books about your country, or the case law on this issue, it would become readily apparent to you that the citizens have a great case. Not everyone can afford the exorbitant taxes on DSL services and the computers we get to read your articles on. Constitutional liberties have been abridged, here. And, while Mr. Bush, is pledging 300 billion in tax cuts--why doesn't he just already give back the money the federal and state governments unconstitutionally have taken from the people. That's what he should do if he "just wants to give the people their money back", as he repeatedly stated during his election campaign


Kudos to Mr. Libow, I hope he goes through with this and wins. It benefits all of us, including you!!


Anonymous

anonymous2
2003-01-07 10:50:13
corporations do not have legal rights
Citrix doesn't have First Ammendment rights. It is not a human person, and so doesn't have any human rights. Corporations have priveleges, not rights. The difference is that priveleges can be revoked.
kbedell
2003-01-07 11:52:16
Book on corporate 'Bill of Rights' protections
Here's a link to an excellent book on how corporatations came to obtain constitutional protections. In case you didn't realize it, there used to be many State laws against corporate involvement in the political process.


In my opinion this is a critical problem in America today. Our democracy is 'sick'. I believe that the imbalances to the 'checks and balances' of American democracy that money and corporate interests inflict are at the core of America's drive to dominate world resources such as oil. It is at the heart of why corporate profits are more important than clean air and the survival of species.


I just hope that corporations don't begin claiming the 'right to bear arms' (amendment 2) in addition to free speech (amendment 1).




anonymous2
2003-01-09 18:25:33
Citrix
I agree, Kudos to Mr. Libow, if he can shrink my phone bill or cable bill by getting rid of the taxes (which I didn't pay when I had rabbit ear antennas) on cable and satellite.


And as far as books, don't we pay enough tax to send our kids to school, and then charge them tax on their learning materials--this is wrong!!