Supreme Court says it will review if Catholic Charities is exempt from labor taxes in a major church-state case

The Supreme Court agreed Friday to decide whether religious affiliated entities like Catholic Charities should be exempt from state unemployment taxes, taking up its first major religion case in more than a year.

The Supreme Court agreed Friday to decide whether religious affiliated entities like Catholic Charities should be exempt from state unemployment taxes, taking up its first major religion case in more than a year. The Catholic Charities Bureau in Wisconsin told the high court that the state’s labor department violated the First Amendment when it declined its request for an exemption from the unemployment taxes. A decision from the conservative Supreme Court could have widespread implications if it sweeps in other types of taxes and religiously affiliated entities, such as hospitals and universities. Forty-seven states and the federal government include exemptions from unemployment taxes for organizations operated for religious purposes, according to Catholic Charities. “If the petitioners get their way, there’s going to potentially be a fallout in these other areas,” said Patrick Elliott, legal director of the Freedom From Religion Foundation, which filed a brief opposing Catholic Charities in state court. Wisconsin’s highest court sided with the state in March, ruling that because Catholic Charities didn’t proselytize or participate in traditional religious activities, it didn’t qualify for the religious exemption from the taxes. “Wisconsin’s rule is both absurd and harmful,” the organization, represented by the Becket Fund for Religious Liberty, told the Supreme Court in its appeal. “The rule takes away resources that would otherwise be used to help the poor and the needy.”