Paul L. Caron
Dean


Tuesday, June 5, 2012

Taxation and George Orwell's Animal Farm

Animal-farmThe Faculty Lounge:  Taxation and Orwell's Animal Farm, by Calvin Massey (New Hampshire):

Indianapolis constructed sanitary sewers for a neighborhood and financed the project by a tax assessment of some $9,300 on each benefited parcel.  Owners could pay in one lump sum, or make monthly payments over 10, 20, or 30 years.  Several years later the city decided to use a different financing method -- issuance of bonds -- to pay for the improvements.  As part of this shift, the city forgave the unpaid installments, but refused to refund any part of the upfront payments made by some 38 owners.  In Armour v, City of Indianapolis [No. 11–161 (June 4, 2012)] the Supreme Court ruled that equal protection was not violated by the city's decision to treat these taxpayers unequally.  Why?  Because it was rationally related to the city's legitimate objective of avoiding administrative inconvenience. ...

This travesty was authored by Justice Breyer, joined by Justices Kennedy, Ginsburg, Thomas, Sotomayor, and Kagan.  The dissent was written by Chief Justice Roberts, joined by Justices Scalia and Alito.  One might wonder why Justices Kennedy and Thomas joined.  Perhaps they thought that any decision invalidating government action under minimal scrutiny -- a/k/a "rational basis" -- would have a destabilizing effect on equal protection doctrine.  But that's a curious explanation for Justice Kennedy, who had little difficulty doing so in Romer v. Evans.  Justice Thomas's concurrence is more of a head-scratcher; perhaps he thought that striking down government actions as irrational would create precedent that might be used to strike down other government actions under minimal scrutiny.  We won't know; we can only guess.  But what we do know is that under Indiana law all taxpayers are equal, but under the equal protection clause some taxpayers are more equal than others.  Orwell would relish the result.

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