The ongoing debate over religious rights and taxation takes center stage as the U.S. Supreme Court prepares to hear a case involving a Catholic charitable organization in Wisconsin. This case raises questions about the intersection of religious motivation and secular activities, and its outcome could set a significant precedent.
The Supreme Court will review a recent decision by Wisconsin’s top court, which denied an exemption from employment tax to the Catholic Charities Bureau located in Superior, Wisconsin. Despite recognizing that Catholic teachings inspire the group’s mission to support vulnerable populations, the state court concluded that the charity’s operations are not predominantly religious.
This case is anticipated to be presented in the spring session.
In recent years, the Supreme Court has consistently ruled in favor of religious organizations in disputes with state governments. Attorneys representing the Wisconsin charities argue that the state court’s decision infringes upon First Amendment rights and call for the Supreme Court to address differing state rulings on similar issues.
Eric Rassbach, the principal attorney for Catholic Charities at the Supreme Court, criticized the state’s stance, stating, “Wisconsin is trying to make sure no good deed goes unpunished. Penalizing Catholic Charities for serving Catholics and non-Catholics alike is ridiculous and wrong.”
On the other side, Wisconsin Attorney General Joshua Kaul advised the Supreme Court to abstain from the case, citing that the organizations receive substantial funding from governmental sources, including state and local governments and the Medicaid program. He emphasized that employees are not required to be Catholic and that recipients of services do not undergo religious instruction.
Catholic Charities has been compliant with the unemployment tax since 1972, according to Kaul. Wisconsin law provides tax exemptions to organizations under church control that primarily operate for religious purposes. The state Supreme Court maintained that both the motivation and the nature of activities must be religious to qualify for tax exemption.
Religious scholars supporting Catholic Charities urged the court to intervene, arguing that the case represents a violation of religious liberty. Various religious groups, including Catholic, Islamic, Lutheran, Jewish, and Mormon organizations, filed briefs in support of Catholic Charities.
Conversely, the Freedom from Religion Foundation argued that a favorable ruling for Catholic Charities could have broader implications on religiously affiliated entities like hospitals and colleges, potentially disqualifying their employees from participating in the state unemployment insurance program.
According to court records, Catholic Charities in Superior administers over 60 programs targeting diverse needs, such as aiding older or disabled individuals, children with special needs, low-income families, and disaster victims, irrespective of their religious affiliations.
