The following column is the opinion and analysis of the writer.
The U.S. Supreme Court recently decided an important case that affects the Arizona education tax credit program. The court upheld a Montana law that allowed a tax credit for donations to private religious schools, and said it did not violate the separation of church and state.
Arizona has a similar program, where taxpayers can receive a dollar-for-dollar credit against their state taxes by donating to public and private — including religious — schools. While the court’s decision upheld the constitutionality of tax credit programs like Arizona’s, taxpayers should nonetheless think twice before using it because it does more harm than good for the state.
One of the consequences of Arizona’s tax credit is that it has exacerbated the effects of educational inequality. Because schools are funded in large part by local property taxes, higher property taxes in wealthier parts of town mean that their schools are better funded than those in poorer areas.
The tax credit exacerbates this inequality because many taxpayers use the tax credit to get friends and family to donate to the local school their child attends. Wealthier families have more money to donate than poorer families, so they can maximize their tax credits to schools in their area. Conversely, taxpayers in low-income areas who make so little income that they pay few or no taxes can make few, if any, donations to their child’s school. This leaves those poorer schools even further behind wealthier schools.
In fact, according to an Arizona Republic statewide analysis of schools that received tax credit contributions in 2012, the school that received the most funds was Tucson’s Catalina Foothills High School. It raised nearly $1 million, spending most of it on athletics and its band program.
The same analysis showed that schools in poorer areas of the state received far fewer donations, with 58 of them receiving nothing from the tax credit program.
A second problem with the tax credit is that it blurs the lines between public and private funds. This tax money, which would otherwise have gone in the general tax pool to fund programs that benefit everyone in the state, is diverted to benefit an individual child’s private education.
This cost can be high indeed, as, according to a 2018 New York Times article, Arizona donors had given $1 billion since the inception of the tax credit program years earlier, depriving the state general fund or public schools of those funds.
This seems particularly unjust because parents who can send their children to private schools usually have enough money that they can make that choice without depriving the state of the tax funds it needs to provide decent educational opportunities for all. Using the tax credit thus allows particular families to benefit at the expense of society at large, which defeats the point of paying taxes. Taxes are meant to fund public goods that everyone needs. But the tax credit diverts this money from programs that benefit everyone and instead uses it to benefit particular students, most of whom are already well-off and do not need the help.
Instead of perpetuating educational inequality and letting private individuals benefit from what should be public funds, our tax dollars should be used to benefit all Arizonans. So, before using the education tax credit, think twice about its negative impacts on the state as a whole. Just because the Supreme Court has said our education tax credit program is legal does not mean we should use it.
Darian Qureshi teaches political science and philosophy at Pima Community College.
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