Bob Jones University v. United States (1983)
Religious Tax Exemptions
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Should private schools that engage in racial discrimination be permitted to retain their tax exempt status if they claim that the discrimination is a part of their religion? This depends upon just why tax deductions exist. If private schools receive their tax deduction simply because they are involved with education, then their discriminatory policies shouldn't matter.
Background Information
Bob Jones University is a conservative, evangelical Christian university that believes interracial dating and marriage is contrary to the its faith. At the time of this case, it refused to admit any black students at all.
In 1970, based on its interpretation of the 1964 Civil Rights Act, the Internal Revenue Service decided to prohibit granting tax-exempt status to any private schools that practiced racial discrimination.
In 1971, Bob Jones University altered its policy and admitted black students who were married "within their own race," but continued its exclusion of unmarried black students. In 1975 it changed its policy once more and began to admit unmarried black students, but enforced strict rules against any interracial dating and expelled anyone who violated this rule.
Included in this case was another religious school that also racially discriminated in its admissions process. Both schools sued when the IRS finally revoked their tax-exemptions in 1975, even though they had not violated any of the provisions of their 501(c)(3) tax exempt status.
Court Decision
The Supreme Court upheld the IRS's Court Decision by an 8-1 vote in 1983. In his majority opinion, Chief Justice Warren Burger found that the Internal Revenue accurately interpreted the law by prohibiting tax exempt status to even religious schools with racially discriminatory policies.
The purpose behind relieving schools from paying taxes is that they serve a charitable function for the whole community. However, racially discriminatory policies outweighed those benefits and, hence, the IRS did not exceed its authority. Moreover, Burger argued that the reason why charitable organizations' tax exemptions are predicated upon serving general community interests is the fact that when such exemptions are granted, "all taxpayers are affected; the very fact of the exemption or deduction for the donor means that other taxpayers can be said to be indirect and vicarious "donors." "
Thus, charitable exemptions are justified entirely on the basis that when an organization is given an exemption, that organization is providing a public benefit and that the organization is not "so at odds with the common community conscience as to undermine any public benefit that might otherwise be conferred."
The IRS policy was based on neutral, secular reasons and the Court cecision would not prevent discriminatory schools from operating as usual. In summary, the "governmental interest substantially outweighs whatever burden" might be experienced by such institutions.
Bob Jones University had argued that even if such reasoning could be applied to nonreligious schools, it was not valid when it came to religious schools that discriminated for religious reasons. That argument was, however, rejected, on the premise that not all burdens on religion are unconstitutional - in particular, when they serve a compelling government interest. For example, in an earlier case, Prince v. Massachusetts, the Court found that child labor laws could be used to prevent religious youths from disseminating religious literature because the government had a compelling interest in protecting children. Here, too, the Court ruled that the government had a compelling interest in eliminating racial discrimination in education.
Justice Powell concurred with the decision, but disagreed with part of the rationale. Specifically, Powell disagreed that charitable institutions receive tax exemptions because they serve some public interest and he was disturbed at the idea that receipt of tax exemptions might be conditioned on conformity to "general public interest."
Justice Rehnquist dissented, arguing that it was Congress' job to exclude racially discriminatory institutions from receiving tax exempt status if, indeed, that was their intention with the laws or if they feel that there is sufficient national consensus against racial discrimination to warrant it. Thus, he found that the Court was legislating in place of the Congress, a complaint he has often made.
In March 2000, due to intense public scrutiny and pressure following a visit by presidential candidate George Bush, Bob Jones University voluntarily rescinded their ban on interracial dating. They continue, however, to enforce other regulations such as a prohibition on all openly gay people on campus, "immodest" dress, and people of the opposite sex touching each other.
Significance
This case demonstrated that the government can have interests which effectively outweigh private religious beliefs. Specifically, an individual's freedom of religious belief cannot be used as an excuse for behavior that violates important principles. Religious beliefs and religious principles cannot trump all other laws and considerations - but it is instructive to note that such decisions are usually rendered against minority beliefs.
Further Information
Back To: Court Decisions on Religious Liberty (main page)
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