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Chicago’s Kartemquin Films v. IL Department of Revenue
After being twice shot down by the state in its attempts to secure sales tax exemption, a locally based maker of documentary films is being denied review of a third application. Why? For, allegedly, the “making and selling of propaganda DVDs.”
That’s according to Tim Horsburgh of Kartemquin Films, whose productions include Oscar-nominated doc “Hoop Dreams” (1994) and the Oscar-snubbed doc “The Interrupters” (2011) as well as a forthcoming film about the life of late Sun-Times movie critic Roger Ebert.
When a representative from the Illinois Department of Revenue (“Nancy”) called yesterday in response to a recent sales tax exemption that Kartemquin Educational Films’ had submitted last week for the the third time, Horsburgh explained via email, “She advised that because our prior apps in 2007 and 2010 were denied, there would be no further review of our application.”
“She then told [Kartemquin's] director of finance and operations, Suzanne Niemoth, that the 2007 application was denied for the ‘making and selling of propaganda DVD’s.’”
Niemoth was “shocked,” Horsburgh wrote, and again asked why Kartemquin had been denied. The representative’s answer was unwavering: for the “making and selling of propaganda DVD’s.”
Kartemquin’s executive director, Justine Nagan, called that description “grossly inaccurate.”
Susan Hofer, a spokeswoman for the Illinois Department of Revenue, said she was unfamiliar with the rep who called Kartemquin. Hofer added, “”I wish I could control some of the things that came out of the mouths of some of the people at Revenue.”
“I don’t know who would have determined that,” Hofer said. “I do know that the only way you get a sales tax exemption is if you’re a school or a charity. And it doesn’t sound like they’re either one.”
Horsburgh noted that Kartemquin’s 2010 rejection letter from the state’s revenue department includes one more possible qualification for sales tax exemption: “Be a not-for-profit 501(c)3 musical, theatrical or arts and cultural service organization.”
Even though Kartemquin has 501(c)3 status, Hofer said, that alone is insufficient.
Horsburgh said Kartemquin plans to request a hearing for further review of its case.
“The real issue for Kartemquin is the state’s denial of our application based on ‘the making and selling of propaganda DVDs.’ Our documentaries bring people powerful human stories that open up dialogue and are crafted to let people make up their own minds. Having to pay sales-tax on Illinois purchases does have a small effect on our financial operations as a whole, but that isn’t why we complained.”