Jimmy Swaggart Ministries Case Study

The Jimmy Swaggart Ministries v. State Board of Equalization of California was an argument against the California law requiring retailers to pay a 6% sales tax on in-state sales on “tangible personal property”. From 1974 to 1981, Jimmy Swaggart Ministries was considered a religious organization classified as a nonprofit corporation and known as such by the Internal Revenue Service, and by the California State Controller. In early 1980, the Board of Equalization of the State of California (Board) became aware Ministries were selling tangible personal property at its crusades in California. During that time period, the ministries went on many “evangelistic crusades” in auditoriums and arenas across the United States with the help of local churches.

(scarinciaattorney.com). The argument by Jimmy Swaggart Ministries was that this law should not apply to the sale and distribution of religious materials such as religious magazines and any other means of spreading the Gospel. The Ministries believed this tax being placed upon them was unconstitutional as it violated the First Amendment, their right to the free exercise of religion. The Ministries contended that their sale of magazines along with other materials such as radio and television broadcasting, recording music and preaching, writing and publishing and in general “any and all other individual or mass media methods that presently exist or may be devised in the future to proclaim the good news of Jesus Christ”, are “religious crusades”, and should be tax exempt because they are performing “an evangelistic outreach to promote the Gospel of Jesus Christ.” (law.justia.com). Jimmy Swaggart Ministries argued that the tax requirement on the sales of religious products is a violation of the Establishment Clause because it gives a place for “an excessive government entanglement with religion.”

The board stated that the ministries’ have misinterpreted Murdock v. Pennsylvania, and Follet v. McCormick, because although flat license taxes on commercial sales is unconstitutional in respect to the evangelical distribution of religious materials, those cases found that they may be constitutionally required to submit to a generally applicable income or property tax for the California tax at issue. (caselaw.findlaw.com). The board also argued that because it only represents a small fraction of the sales, and is required for all sales neutrally whether or not they are religious in nature, there is no evidence that the ministries’ religious activities are being singled out for special treatment. The board claimed that the ministries’ position that the freedom to exercise their beliefs is unconstitutionally hindered by the loss of funds stemming from the presumably lower demand for its products (caused by the slightly higher price caused by the tax) and from the costs associated with imposing the tax, that it’s free exercise claim is invalid because it