Equal protection in taxation

No person shall be deprived of life, liberty, or property without due process of law, nor shall any person be denied the equal protection of the laws. (Article III, Section 1 of the 1987 Constitution) "Equal protection of the laws" extends to tax laws.

All persons subject to legislation shall be treated alike under similar circumstances and conditions both in the privileges conferred and liabilities imposed. (1 Cooley 824-825)

At the outset, the Court did not regard the Equal Protection Clause as having any bearing on taxation. It soon, however, entertained cases assailing specific tax laws under this provision, and in 1890 it cautiously conceded that "clear and hostile discriminations against particular persons and classes, especially such as are of an unusual character, unknown to the practice of our governments, might be obnoxious to the constitutional prohibition." (Cornell Law School)

The Court observed, however, that the Equal Protection Clause "was not intended to compel the State to adopt an iron rule of equal taxation" and propounded some conclusions that remain valid today. In succeeding years the clause has been invoked but sparingly to invalidate state levies. In the field of property taxation, inequality has been condemned only in two classes of cases: (1) discrimination in assessments, and (2) discrimination against foreign corporations. In addition, there are a handful of cases invalidating, because of inequality, state laws imposing income, gross receipts, sales and license taxes. (Cornell Law School.  Traditional equal protection: economic regulation and related exercises of the police power. Taxation. www.law.cornell.edu)

The doctrine does not require that persons or properties different in fact be treated in laws as though they were the same. Indeed, to treat them the same or alike may offend the Constitution. What the Constitution prohibits is class legislation which discriminates against some and favors others. As long as there are rational or reasonable grounds for so doing, Congress may, therefore, group the persons or properties to be taxed and it is sufficient "if all of the same class are subject to the same rate and the tax is administered impartially upon them." (1 Cooley 608)

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