Sklars Lose Case Involving Scientology Tax Exemptions

The Sklar litigation relating to the Church of Scientology was delivered another blow by the Ninth Circuit. Marla and Michael Sklar have been waging a rather lonely battle for 15 years to claim tax deductions for a portion of the tuition they pay to Jewish schools attended by their children. They are relying on the fact that the Internal Revenue Service granted Scientologists deductions for 80% of fees they pay for auditing and training. The IRS decision was viewed as the government knuckling under after litigation from Scientology and has raised legitimate concerns over equal treatment.

The panel (in an opinion written by Judge Kim Wardlaw) held: “We… conclude that tuition and fee payments to schools that provide secular and religious education as part of one curriculum are quite different from payments to organizations that provide exclusively religious services.”

Wardlaw’s does not fully explain why Scientologists receive such a huge deduction but Jews cannot receive deduction for such things as after-school classes in Jewish Oral Law, or Mishna.

The greatest problem is that it remains unclear if anyone can challenge this type of alleged constitutional abuse. The Supreme Court has been trashing the standing of citizens to challenge the government, leaving some areas without clear ability of citizens to seek judicial review and remedy. This is becoming extremely serious since our system of constitutional guarantees mean little if people cannot bring such matters to an independent court for action. Congress needs to look into the loss of standing for citizens in this country as a priority of the new Congress and the new Administration.

For the opinion, click here and the concurring opinion, here.

For an account of the ruling, click here.