Suspect Linkage: The Interplay of State Taxing and Spending Measures in the Application of Constitutional Antidiscrimination Rules

This article examines an important and recurring question that courts frequently resolve, but rarely analyze: whether taxing and spending measures should be viewed together when a state imposes a nondiscriminatory tax but also affords relief to some taxpayers through government spending. The answer to this question will often determine whether the state’s actions violate constitutional strictures against discriminatory taxation. The taxing measure and the spending measure will generally pass muster if viewed in isolation. After all, courts rarely invalidate nondiscriminatory taxing measures on constitutional grounds. And true government spending measures, if considered alone, plainly fall outside the reach of constitutional restraints against discriminatory taxation. On the other hand, when taxing and spending measures are viewed together, they raise profound problems. In particular, the two measures often operate to produce precisely the result that the constitutional prohibitions against discriminatory taxation seek to avoid: the imposition of a greater burden in “practical effect” on a constitutionally protected class of state taxpayers.