Tax credits for religious schools? Supreme Court says taxpayers have no say.
The Supreme Court rules 5 to 4 that taxpayers do not have legal standing to challenge an Arizona tax-credit program because the state is not directly funding the parochial schools.
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Opponents of the program expressed disappointment and concern.Skip to next paragraph
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“This decision puts taxpayers’ rights to challenge many government subsidies to religion in extreme jeopardy,” said the Rev. Barry Lynn, executive director of Americans United for Separation of Church and State.
“The court, with the full support of the Obama administration, has slammed the courthouse door in the face of Americans who don’t want their tax dollars to subsidize religion,” he said.
Under the Arizona system, taxpayers may claim a $500 tax credit when they make a donation to help underwrite private school tuition – including tuition to a religious school.
Opponents of the system said it was designed to channel government money from the tax credit to religious schools. A program that primarily benefits parochial schools is a violation of the First Amendment’s prohibition on government endorsement of religion, they said.
How tax credit benefits religious schools
The tax credit system was set up in 1997 by the Arizona legislature. It is designed to encourage parents and other Arizona residents to contribute to private school education.
The program requires that donations be made to a School Tuition Organization (STO), a private, non-profit group set up to award scholarships from the donated funds. In 2009, there were 53 STOs. They received $51 million in donations.
What makes the program controversial is that half of the STOs only award scholarships to religious schools. In addition, most of the donated money flows through STOs that award scholarships at religious schools.
Opponents see the tax credit system as a government benefit program to advance religion. Supporters view it as a mechanism that allows private individuals to decide whether their tax credit will be used to benefit a religious school or not.
The appeal involved two cases consolidated for argument at the high court. They were Arizona Christian School Tuition Organization v. Winn (09-987) and Garriott v. Winn (09-991).
“It is easy to see that tax credits and governmental expenditures can have similar economic consequences,” Kennedy wrote. “Yet tax credits and governmental expenditures do not both implicate individual taxpayers in sectarian activities.”
“A dissenter whose tax dollars are extracted and spent knows that he has in some small measure been made to contribute to an establishment [of religion] in violation of conscience,” Kennedy said.
“When the government declines to impose a tax, by contrast, there is no such connection between dissenting taxpayer and alleged establishment,” he said. “Any financial injury remains speculative. And awarding some citizens a tax credit allows other citizens to retain control over their own funds in accordance with their own consciences.”