Court Opinion

ID: 9701234
Source: CourtListenerOpinion
Date Created: 2023-08-25 22:11:43.949945+00
Date Added: 2024-06-11T18:21:21.136173
License: Public Domain

NEWMAN, Judge,
concurring and dissenting.
I concur with the majority opinion except for its holding that the New Bank Tax Credit Law is unconstitutional. Therefore, I respectfully dissent in part.
“Unless a classification warrants some form of heightened review because it jeopardizes exercise of a fundamental right or categorizes on the basis of an inherently suspect characteristic, the Equal Protection Clause requires only that the classification rationally further a legitimate state interest.” *546Nordlinger v. Hahn, — U.S.-,-, 112 S.Ct. 2326, 2327, 120 L.Ed.2d 1 (1992).1 The Supreme Court has recognized that “in structuring internal taxation schemes the States have large leeway in making classifications and drawing lines which in their judgment produce reasonable systems of taxation.” Williams v. Vermont, 472 U.S. 14, 22, 105 S.Ct. 2465, 2471, 86 L.Ed.2d 11 (1985) quoting Lehnhausen v. Lake Shore Auto Parts Co., 410 U.S. 356, 359, 93 S.Ct. 1001, 1004, 35 L.Ed.2d 351. Furthermore, “under the equal protection clause, and under the uniformity clause, absolute equality and perfect uniformity in taxation are not required.” City of Pittsburgh v. Commonwealth, 522 Pa. 20, 24-25, 559 A.2d 513, 515 (1989) quoting Columbia Gas Corp. v. Commonwealth, 468 Pa. 145, 151, 360 A.2d 592, 595 (1976).
Since the New Bank Tax Credit law involves neither fundamental rights nor a suspect classification, it is constitutional if it is rationally related to the legitimate purpose that the legislature intended to further. In enacting the New Bank Tax Credit Law, the legislature expressed its intent as follows:
The General Assembly of the Commonwealth of Pennsylvania hereby finds that:
a) Whereas, the continuing health, stability and growth of the banking industry in Pennsylvania is of great importance to the citizens of the Commonwealth; and
b) Whereas, the establishment and growth of new banks will help to foster these objectives;
c) Therefore, it is in the public interest to provide tax credits to new banks to help ensure the health, stability and growth of the banking industry in Pennsylvania and its attendant benefits to all citizens of this Commonwealth.
72 P.S. § 8902.
It is beyond any possible doubt that granting tax credits is rationally related to the Commonwealth’s interest in encouraging new banks to conduct business in Pennsylvania.
*547Furthermore, in order for the New Bank Tax Credit Law to be constitutional, the classification of banks chartered before and after January 1, 1979 must be “based upon some legitimate distinction between the classes that provides a non-arbitrary, reasonable and just basis for the difference in treatment.” Magazine Publishers at 602, 618 A.2d at 1061, quoting Leonard v. Thornburgh, 507 Pa. 317, 321, 489 A.2d 1349, 1352. As the majority notes, “the effect of amendments and additions was to offset the large tax rate increase for new banks because they would not be receiving credits as satisfaction of the Commonwealth’s refund obligation.” (Majority Opinion at p. 540). The distinction between “old” and “new” banks meets the standard set forth in Magazine Publishers and Leonard, because it recognizes the legitimate difference between banks that will automatically receive a tax credit from the Commonwealth and those that will not. By offering relief from a high rate of taxation, the New Bank Tax Credit Law serves the important government interest of supporting the continued operation of new banks.
For the foregoing reasons I would conclude that the New Bank Tax Credit Law is constitutional.

. As the majority notes, violations of the Equal Protection Clause of the Constitution of the United States and the Uniformity Clause of the Pennsylvania Constitution are to be analyzed in the same manner. Magazine Publishers of America v. Commonwealth, Department of Revenue, 151 Pa.Commonwealth Ct. 592, 618 A.2d 1056 (1992).