Tex. Monthly, Inc. v. Bullock - 489 U.S. 1, 109 S. Ct. 890 (1989)

Rule:

Texas' sales tax exemption for periodicals published or distributed by a religious faith and consisting wholly of writings promulgating the teaching of the faith, Tex. Tax Code Ann. § 151.312 (1982), lacks sufficient breadth to pass scrutiny under the Establishment Clause. Every tax exemption constitutes a subsidy that affects nonqualifying taxpayers, forcing them to become indirect and vicarious donors.

Facts:

Between October 2, 1984, and October 1, 1987, a Texas sales and use tax provided an exemption for periodicals that were published or distributed by a religious faith and that consisted wholly of writings promulgating the teaching of the faith, and for books that consisted wholly of writings sacred to a religious faith. The exemption was challenged by appellant, a publisher which was not a religious faith and whose publication, a general-interest magazine, did not contain only articles promulgating the teaching of a religious faith. In 1985, appellant paid sales taxes under protest and sued to recover them in state court. The District Court of Travis County, Texas, held that an exclusive exemption for religious periodicals was prohibited under the establishment of religion clause of the Federal Constitution's First Amendment and was also unconstitutional as discriminating on the basis of the content of publications. Accordingly, the District Court struck down the tax as applied to nonreligious periodicals and ordered the state to refund the publisher's tax payments plus interest. The Court of Appeals of Texas, Third District, reversed, holding that the exemption served the secular purpose of preserving separation between church and state, did not have the primary effect of advancing or inhibiting religion, and did not produce impermissible government entanglement with religion. The Court of Appeals also held that the exemption did not violate the free press guaranty of the Federal Constitution's First Amendment. Appellant challenged the decision.

Issue:

Did the sales tax exemption for religious publications violate the First Amendment as made applicable to the states by the Fourteenth Amendment?

Answer:

Yes.

Conclusion:

The Court held that the exemption lacked sufficient breadth to pass scrutiny under the Establishment Clause. According to the Court, the fact that a subsidy incidentally benefitted religious groups did not deprive it of the secular purpose and effect mandated by the Clause, so long as it was conferred on a wide array of nonsectarian groups as well as religious organizations in pursuit of some legitimate secular end. However, when, as here, the government directed a subsidy exclusively to religious organizations that was not required by the Free Exercise Clause of the First Amendment and that either burdens nonbeneficiaries markedly or cannot reasonably be seen as removing a significant state-imposed deterrent to the free exercise of religion, it cannot be viewed as anything but impermissible state sponsorship of religion, particularly where the subsidy was targeted at writings that promulgate the teachings of religious faiths. Because it confined itself exclusively to such religious publications, the Texas exemption lacked a secular objective that would justify its preference along with similar benefits for nonreligious publications or groups. The Court nevertheless held that Texas was free to widen the exemption, so long as the class of exempt organizations was sufficiently expansive to be consonant with some legitimate secular purpose.