481 U. S. 221
April 22, 1987
The state of Arkansas had a generally applicable sales tax on nearly all goods. Newspapers were exempted, as were magazines devoted to sports, religion, trades, or professions. The Arkansas Times, a general interest magazine, protested that the state infringed on the freedom of the press by not exempting general interest magazines as well.
In a 7-2 ruling, the Court stated that the Arkansas law violated the First Amendment. Writing for the majority, Marshall first turned back a standing argument that only exempted magazines could have grounds to sue. He conceded that a state could put a sales tax on all newspapers and magazines, but denied a state’s right to make exemption distinctions based on a magazine’s content. The state’s asserted interest in aiding fledgling publications was held to be unconvincing, since general interest magazines could easily be just as fledgling as ones dedicated to sports or religion. Without a compelling reason, the exemption distinctions violated the First Amendment.
Stevens felt that in certain circumstances a government could make distinctions based on content, but otherwise joined the majority opinion. Scalia dissented, and was joined by Rehnquist. He argued that an exemption should be legally viewed as identical to a subsidy. Because governmental bodies are allowed a good degree of discretion in subsidizing some, but not all, First Amendment activity, the Arkansas exemption scheme should have been ruled Constitutional. I have to say, I disagree with Scalia – I think subsidies and tax exemptions can be distinguished, and would have joined Marshall’s opinion.