Making a National K-12 Scholarship Tax Credit Subject to State-Level Approval Likely Runs Afoul of the U.S. Constitution’s Uniformity Clause

Posted on Sunday, June 11th, 2017

The Trump Administration remains committed to action on school choice. A leading candidate for action is the idea of a national K-12 scholarship tax credit, borrowing an idea that 17 states already have adopted.

Some school-choice advocates have suggested making any such national tax credit subject to state approval. This philosophical position is partly a reaction to the Obama administration using the federal Race to the Top program to coerce states into adopting Common Core standards. The Obama administration’s decision to issue “guidance” to schools on various hot-button social issues also inflamed similar passions.

Some in this “federalist” camp also simply reject the notion that the federal government has any authority in the area of education, which they view solely as the purview of state and local governments.

For federal spending programs, state approval clearly could be required as a condition of any funding program flowing to the states. But applying this logic to the nation’s tax code may not be constitutional.

The little known Uniformity Clause requires that similarly situated federal taxpayers be treated similarly regardless of the states in which they reside.

Specifically, the Uniformity Clause requires that “all Duties, Imposts and Excises shall be uniform throughout the United States.” U.S. CONST. art. 1, § 8, cl. 1.

A lack of “geographical uniformity” exists when “the rule of [tax] liability” would not be “alike in all parts of the United States.” State of Florida v. Mellon, 273 U.S. 12, 17 (1927).

The intent of the Uniformity Clause was to ensure that any federal tax “operates with the same force and effect in every place where the subject of it is found.” Edye v. Robertson, 112 U.S. 580, 594 (1884 ).

The lack of uniformity may not be remedied constitutionally by the fact that state approval was secured to opt-out or opt-in. The Uniformity Clause was intended “for the protection of individuals,” not states. New York v. United States, 505 U.S. at 181–82 (1992).

Any national scholarship tax credit that included a provision for state approval would inevitably lead to similarly situated federal taxpayers being treated differently depending on their state of residence. This outcome appears to run afoul of the U.S. Constitution’s Uniformity Clause.
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