The Louisiana Court of Appeals reversed a decision by the Board of Tax Appeals and established that the state’s constitutional prohibition against taxation of prescription drugs also applies to medical devices. In the case at hand, a medical center argued that it was the goal and intent of the constitutional prohibition to permanently cement the exemption, which had previously included pharmaceuticals and medical devices, and not allow it to be suspended or otherwise affected. The medical center additionally argued that the phrase “prescription drugs” extended to “medical devices.” The Department of Revenue (DOR) argued that the plain meaning of “prescription drugs” does not include medical devices such as an artificial hip or pacemaker and is rather a substance used as a medication or in the preparation of medication. The court noted that the Board’s and DOR’s interpretation of the meaning of “prescription drugs” resulted in an expansion of taxes on the general public and in favor of the taxing authority. Per Louisiana tax law, tax statutes must be strictly construed against the taxing authority. If a tax statute is open to more than one reasonable interpretation, the construction favorable to the taxpayer is adopted. In this case, the debate regarding whether the term “prescription drugs” extended to “medical devices” lent itself to more than one interpretation. As a result, the court ruled in favor of the taxpayer. Additionally, the legislative history showed a clear intent to create a constitutional prohibition against the institution of temporary taxes on “prescription drugs,” which historically always included medical devices. Accordingly, the court ruled that the constitutional prohibition against taxation on prescription drugs includes medical devices. (Lafayat General Medical Center v. Louisiana Department of Revenue, Court of Appeal of Louisiana, Third Circuit, No. 18-879, August 14, 2019)