Opinion ID: 1788757
Heading Depth: 1
Heading Rank: 8

Heading: Content-based Taxation and the Taxation of Fundamental Rights

Text: Opponents of the tax also argue that chapter 87-6 constitutes a direct tax on the exercise of the constitutional right to free speech. As we pointed out during our previous discussion of the equal protection concerns of advertisers and the press, however, this tax on the sale and use of services is one of general application and does not single out advertisers or the press for special taxation. Moreover, as will be discussed in more detail later, the tax is levied upon those in the business of trafficking in first amendment expression rather than upon the exercise of the right to free speech itself. [7] It is beyond question that advertisers and the press are not immune from ordinary, nondiscriminatory taxes of general application. Arkansas Writers' Project, Inc. v. Ragland, ___ U.S. ___, ___, 107 S.Ct. 1722, 1725, 95 L.Ed.2d 209 (1987); Minneapolis Star and Tribune Co. v. Minnesota Commissioner of Revenue, 460 U.S. 575, 581, 103 S.Ct. 1365, 1369, 75 L.Ed.2d 295 (1983); Grosjean v. American Press Co., 297 U.S. 233, 250, 56 S.Ct. 444, 449, 80 L.Ed. 660 (1936). Therefore, we reject the argument that the instant tax is directly and discriminatory aimed at the exercise of the constitutional right of free speech. Opponents of the act also argue, however, that the instant tax targets the press and discriminates based on the content of the speech involved. Proponents of this view cite to Arkansas Writers' Project, Inc., Minneapolis Star, and Grosjean in support of this view. We find, however, significant contrasts between chapter 87-6 and those tax schemes struck down in these three cases. Indeed, rather than support the opponents' arguments, we believe that these three cases support the facial constitutionality of the statute. In Grosjean, Louisiana enacted a license tax that only applied to publications within the state of Louisiana with a circulation of more than 20,000 copies per week. Due to the narrow scope of the statute, the law taxed only thirteen newspapers out of the more than 124 publishers in the state. Minneapolis Star, 460 U.S. at 579, 103 S.Ct. at 1368. In striking down the law, the United States Supreme Court rejected the state's argument that the law imposed a license tax for the privilege of selling or charging for advertising. Instead, the Court found the law to be a deliberate and calculated effort, in the guise of a tax, to penalize certain publishers and to limit the circulation of a selected group of newspapers. [8] Over four decades later, in Minneapolis Star, the Supreme Court struck down a use tax on the cost of ink and paper products consumed in the production of publications. 460 U.S. at 577, 103 S.Ct. at 1367. In a situation similar to that encountered in Grosjean, the use tax in Minneapolis Star was drawn so narrowly that it applied only to fourteen out of the 388 paid circulation newspapers in Minnesota. [9] Attaching significance to the fact that Minnesota had deliberately chosen not to apply its general sales and use tax to newspapers and had, instead, enacted a separate special tax applicable only to the press, the Court struck down the special use tax as facially discriminatory. In doing so, the Court made the following observation: A power to tax differentially, as opposed to a power to tax generally, gives a government a powerful weapon against the taxpayer selected. When the State imposes a generally applicable tax, there is little cause for concern. We need not fear that a government will destroy a selected group of taxpayers by burdensome taxation if it must impose the same burden on the rest of its constituency. ... . The main interest asserted by Minnesota in this case is the raising of revenue. Of course that interest is critical to any government. Standing alone, however, it cannot justify the special treatment of the press, for an alternative means of achieving the same interest without raising concerns under the First Amendment is clearly available: the State could raise the revenue by taxing business generally... . 460 U.S. at 585-86, 103 S.Ct. at 1371-72. Of perhaps even greater significance to the situation before this Court, the Supreme Court specifically rejected one newspaper's argument that a generally applicable sales tax would be unconstitutional, concluding that our cases have consistently recognized that nondiscriminatory taxes on the receipts or income of newspapers would be permissible. 460 U.S. at 587 n. 9, 103 S.Ct. at 1373 n. 9. This latter conclusion was reemphasized in Arkansas Writers' Project, ___ U.S. at ___, 107 S.Ct. at 1727. In Arkansas Writers' Project, the Supreme Court found that the Arkansas sales tax selectively taxed some magazines and not others based solely on content. Accordingly, the Court struck down the tax law, which exempted from taxation religious, professional, trade and sports journals and/or publications printed and published within ... [Arkansas] when sold through regular subscriptions as unconstitutionally discriminative of publications based on content. Id. at ___ & ___, 107 S.Ct. at 1724 & 1729. The Court, however, reemphasized that genuinely nondiscriminatory taxes on newspaper receipts are constitutionally permissible. We find the instant tax to be facially consistent with both the letter and the spirit of these three cases. Unlike the statute considered in Grosjean and Minneapolis Star, chapter 87-6 does not impact only a select few advertisers or publications. Moreover, not only does it apply to the overall industries, it is part of the same general sales tax provision that will apply to all other nonexempt businesses involved in the sale or use of services in Florida. Thus, the instant tax is wholly dissimilar to the use tax on ink and paper considered in Minneapolis Star. Indeed, the instant tax does exactly what the Supreme Court approved and criticized Minnesota for failing to do, i.e., extend the general sales tax to the press. Nor do we believe the instant tax to be similar to the tax struck down in Arkansas Writers' Project. Newly created section 212.08(7)( o )1 of the Florida Statutes exempts sales and leases to religious, scientific, educational, and other nonprofit institutions from the sales tax when those transactions are in the furtherance of their customary nonprofit functions. Ch. 87-6, § 14, Laws of Fla. This exemption, among other things, leaves intact the preexisting comprehensive exemption for the use, sale and distribution of religious publications. § 212.06(9), Fla. Stat. (Supp. 1986). Moreover, the general sales tax exemption for government, nonprofit institutions, and religious organizations predates chapter 87-6, which merely extends this exemption to cover the newly taxed services. See § 212.08(6) & (7), Fla. Stat. (1985). We disagree with opponents of the law that the act unconstitutionally discriminates between publications based on content. Notably, prior to the enactment of chapter 87-6, some commercial advertisements were exempt from taxation of the sale and use of goods while others were not. [10] Additionally, magazines sold at newsstands were taxed while newspapers were not. Thus, in at least some ways, the instant enactment serves to eliminate content-based discrimination rather than create it. Moreover, the institutions exempted from taxation under section 212.08(7)( o )1 are not exempted solely from the taxation of publications and advertisements which they purchase and disseminate. Rather, they are exempted from taxation for all their transactions that would otherwise be taxable under a sales and use tax on goods and services. Therefore, unlike the tax law at issue in Arkansas Writers' Project, the instant law does not require an evaluation of a publication's content in order to determine its status for taxation purposes. In the case of the exemption granted to government entities, contained under section 212.08(6), Florida Statutes, as amended by the act, we find that both law and common sense require this provision. The federal government is constitutionally immune from taxation. Also, taxing the state government or its subdivisions to raise revenues to fund the operation of state government would be nonsensical and circuitous. In the case of religious institutions, the exemption is wholly consistent with the sort of benevolent neutrality that is constitutionally required. Corporation of the Presiding Bishop of the Church of Jesus Christ of Latter-Day Saints v. Amos, ___ U.S. ___, ___, 107 S.Ct. 2862, 2867, 97 L.Ed.2d 273 (1987); Walz v. Tax Commission, 397 U.S. 664, 678, 90 S.Ct. 1409, 1416, 25 L.Ed.2d 697 (1970). We believe that the instant exemption from taxation as applied to religious institutions serves the permissible legislative purpose [of alleviating] significant governmental interference with the ability of religious organizations to define and carry out religious missions without advancing religion through state activities and influence. Corporation of the Presiding Bishop, ___ U.S. at ___, 107 S.Ct. at 2868. Nor are we persuaded that the tax exemption for a select few types of motion picture productions makes the rest of the media selected targets of discriminatory taxation. Thus, the press' tax burden is not discriminatorily based on content and the strict scrutiny test is not triggered. We believe these exemptions set forth in the act are, at the very least, rationally related to the furtherance of important social policies and, therefore, constitutionally permissible. In light of the above, we do not find that chapter 87-6 facially violates the freedom of speech and press guarantees contained in article I, section 4 of the Florida Constitution. [11]