Today, Feb. 10, 2012, the Texas Supreme Court dismissed the Nestle USA, Inc., Switchplace, LLC, and NSBMA, LP, Realtors challenge to the constitutionality of the Texas Margin Tax for lack of jurisdiction.
Unlike the Allcat challenge, the court did not refer the issue to a district court but ruled that that petitioners did not have the right to sue for franchise tax refunds because “petitioners did not pay their taxes under protest or request a refund from the Comptroller, statutory prerequisites to taxpayer suits…” Evidently Allcat had filed under protest which allowed that case to be referred to a district court.
The Court explained that suits for tax refunds are only allowed under specific statutes and that petitioners did not meet the requirements of those statutes. This appears to end Nestle’s constitutional challenge to the tax.
You can read the nine-page opinion on the Texas Supreme Court website.