Written by Marc Hogan — Local clubs have been facing six-figure tax bills on the grounds that rap, county, rock, and electronic music don’t meet the county’s definition of “music” under the scope of “fine arts”.
New legislation proposed today seeks to clear up the debate in Chicago over whether rock, rap, and electronic music count as “music” when it comes to tax laws. Cook County, the municipality that includes Chicago, has been seeking about $200,000 apiece in back taxes from two small venues in the city, Evil Olive and Beauty Bar. Under the county code, venues that hold fewer than 750 people are exempt from a 3 percent tax on admission fees for “live cultural performances,” including music. At a hearing on August 22, an administrative law judge said rock, country, rap, and DJ-based music did not necessarily constitute “music” within the scope of “fine arts” defined in the county code. The issue has drawn widespread outcry, with an editorial in The Chicago Tribune calling the debate “downright embarrassing.”
Today, Cook County commissioner John Fritchey introduced legislation to amend the County's amusement-tax ordinance, his office has announced. According to a press release sent to Pitchfork, the language of his proposed change closely mirrors the rules in the city of Chicago, which specifically includes performing DJs in its amusement-tax exemption.
“I don’t believe that government should be playing culture police and deciding what constitutes ‘music,’” Fritchey said in the release. “Going after small businesses who have in good faith complied with what should be a commonsense reading of the law is just plain wrong, and to have it happen in a city that has given the music industry some of its most famous DJs and rappers just adds insult to injury.”
Joe Shanahan, owner of Metro/Smart Bar, a beloved Chicago music venue, cheered the proposed ordinance amendment. “Small music venues in Chicago and Cook County serve as music incubators that provide valuable opportunities for DJs, bands, and artists of any or all genres of music to perform for audiences allowing them not only to showcase their art while also creating jobs and adding to our local economic engine,” Shanahan said in the release. “For these venues to be faced with the possibility of being penalized for reasonably believing that they were complying with the regulations is not a healthy pro-business or pro-cultural approach for a community that constantly needs to be nurtured in order to flourish and survive.”
A change to the Cook County ordinance would clarify the amusement tax exemption going forward, but it wouldn’t apply to any back taxes currently owed by venues like Evil Olive and Beauty Bar. According to the press release, Fritchey also delivered a letter to Cook County board president Toni Preckwinkle asking her to have the county’s department of revenue stop going after back taxes from venues that are exempt under the city of Chicago’s rules. “If their past activities were found to be in compliance with city policy and they paid county taxes in accordance with that policy then that should be good enough,” Fritchey said.
Fritchey intends to introduce the legislation formally when the county board of commissioners meets again on September 14.
Separately, the Chicago Reader—which first brought the issue to light earlier this month—reports today that Cook County CFO Ivan Samstein said the county had never tried to define music or art, let alone tax small venues on that basis. “We have never applied the tax different for different genres of music,” Samstein reportedly said. “Fine arts is a relative discussion. I don't think anyone [in the county] is in the business of saying what is and what is not fine arts.”
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