Cities Have Leeway in Forgiving Tax Payments: Supreme Court
The Supreme Court ruled on Monday that a city did not violate the Constitution when it forgave some future property tax obligations for certain taxpayers, but refused to refund payments made by other taxpayers for the same assessments.
In a case that impacts tax policy, taxpayers and local governments, the high court ruled by a 6-3 vote that authorities in Indianapolis had a rational basis for making the distinction and had not violated the Constitution’s Equal Protection Clause in their handling of a special sewer tax levied in 2004.
Property owners who paid the $9,278 tax up front were upset when the Indianapolis Board of Public Works in 2005 decided to forgive the obligations of those who chose to pay in monthly installments, with interest, over 10, 15 or 30 years.