Ministry News

High Court OKs Tax Credits for Religious School Scholarships

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Tuesday, 05 April 2011 16:16

The U.S. Supreme Court on Monday dismissed a lawsuit that challenged Arizona's tax breaks for voluntary donations that benefit private-school scholarships, many of them Christian-based. The state program provides dollar-for-dollar income-tax credits for money that's given to school tuition organizations, or STOs. Writing for the majority of the 5-4 ruling, Justice Anthony Kennedy said taxpayers who challenged the program lacked "standing," a legal requirement necessary for a case to be heard.

"The fact that [those challenging the program] are state taxpayers does not give them standing to challenge the subsidies that [the program] provides to religious STOs," Kennedy wrote.

At the heart of the case was the politically charged triad of taxes, religion and education. Arizona taxpayers who challenged the program as unconstitutional said not-for-profit religious organizations award most of the scholarships and require children to enroll in religious schools. They claimed the state has, in effect, been funneling taxpayer money to religious schools through a third-party "front" group.

The justices, however, were divided over whether that represented a de facto "endorsement" of religion by Arizona and whether the tax credit meant the donated amount was the government's money or an individual's.

In this ruling, Kennedy said the tax credit did not amount to a "government expenditure."

"Awarding some citizens a tax credit allows other citizens to retain control over their own funds in accordance with their own consciences," he said.  —CNN