Class Fights Tax on Pizza Delivery

EDWARDSVILLE, Ill. (CN) - A class action claims that Papa John's charges Illinois customers an illegal sales tax on its pizza delivery charge.
     Zachary Tucker sued Papa John's International and Papa John's USA in Madison County Court. Tucker claims the pizza giant charges the illegal tax on the delivery charge.
     "In Illinois, sales tax may only be imposed on the local sales price of taxable tangible property," the lawsuit states. "The sales price is the total amount paid for tangible goods, including services that are part of the sale; however, when a customer has the option to either pick up the goods or have the goods delivered by the seller, as in the case herein, a seller may not legally charge sales tax on a separate charge for delivery where the cost of delivering the merchandise is equal to or exceeds the delivery fee. To the extent the actual cost of delivery is less than the delivery fee itself, under Illinois law, Papa John's is permitted to charge sales tax only on the excess amount."
     Since customers have the option to pick up their food or have it delivered, Tucker claims Papa John's cannot legally charge sales tax on its delivery fees.
     "Despite clear Illinois law to the contrary, Papa John's and its franchise stores have in the past charged and continue to charge sales tax on the entire delivery fee," the complaint states. "As a result, every customer who has ordered food for delivery from any Papa John's location in Illinois has paid excess sales tax that defendants and other franchise owners were not entitled to collect."
     The class consists of anyone who ordered from a Papa John's in Illinois who were charged, and paid, sales tax on an itemized delivery fee.
     The class seeks a cease and desist ruling prohibiting Papa John's from continuing to charge the sales tax in question. It also seeks damages for negligence, breach of contract/breach of faith and violations of the Illinois Consumer Fraud Act and the Uniform Deceptive Trade Practices Act.
     The class is represented by Francis J. "Casey" Flynn Jr. of Carey, Danis & Lowe in St. Louis.