Tennessee: ‘Crack Tax’ Refunds – 2,772 People Eligible
Since the Tennessee Supreme Court struck down the so-called “crack tax” in 2009, the state Department of Revenue has refunded $3.7 million to 161 people but there are still 2,772 people who paid the tax that may be eligible for a refund.
In 2005, State Representative Charles Curtiss co-sponsored legislation with Senator Randy McNally that would tax drug dealers after they were caught.
“We passed the law and collected ten million dollars, and assessed 70 or 80 million which hadn’t been collected yet,” said Curtiss.
But attorneys opposed to the tax said overzealous implementation of the crack tax victimized dozens of Tennesseans.
Many of those who paid the tax were convicted drug dealers but attorneys claim that many of the assessments occurred before the suspect was even convicted.
“The government was seizing homes before people were even arrested or convicted, and that’s wrong,” said attorney David Raybin.
“They’ve broken children’s piggy banks. They’ve taken properties that have been in families for generations,” said Knoxville attorney Philip Lomonaco, the attorney who got the law struck down. “They’ve actually chased people down at the courthouse to get gold chains. It’s ruthless.”
One of Raybin’s clients is former Williamson County Sheriff Ricky Headley who was busted for illegal prescription pills, the state taxed him $13,000 on the value of those drugs.
Headley resigned as sheriff, pled guilty to four drug counts and one count of official misconduct and was sentenced to just under five years probation.
Raybin got Headley’s $13,000 back – plus interest.
However, Curtiss and McNally aren’t giving up on the crack tax. They have passed a new version specifically targeting drug dealers that will soon go into effect.
“We rewrote it with the help of the attorney general and he thinks pretty strongly that he can defend it,” said Curtiss.
Thousands of Tennesseans are eligible for a refund but they can only be claimed within three years of seizure of the asset.
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