Berkley Center

In Walz v. Tax Commission, the Supreme Court upheld the constitutionality of tax exemptions for property used exclusively by religious, educational, or charitable entities. Walz, a property owner in New York, filed suit against the city tax commission alleging that the tax exemptions the state provided to religious institutions amounted to a financial contribution to these institutions in violation of the Establishment Clause of the First Amendment. The Court disagreed, concluding that the purpose of the exemptions was not to advance or inhibit religion; the exemptions were available to a broad class of institutions the state found desirable, including hospitals, libraries, playgrounds, scientific, professional, historical, and patriotic groups. After examining the long history in the United States of exempting religious institutions from taxation, the Court determined that the exemption has not resulted in the excessive entanglement of religion and the government. In fact, the Court found, taxing religious property could increase government entanglement by giving rise to tax valuation of church property, tax liens, and tax foreclosures. Further, demanding that religious institutions support the government by paying taxes would also create entanglement.