The below excerpt is from Amy Hamilton’s article, “Coalition Mounts Effort to Amend Tax Injunction Act,” published by Tax Notes on April 19, 2023. Read the full article on Tax Notes’ website here.
The FAIR Coalition is proposing that Congress modernize the Tax Injunction Act (TIA) out of increasing concern that challenges to state taxes involving questions of federal law or the U.S. Constitution are not reviewed by federal courts. But does anyone want more cases in the federal court system?
Jordan M. Goodman discussed this topic at the 2022 Paul J. Hartman State and Local Tax Forum this past October. “What’s this drive to get to federal court? I don’t understand,” said Jordan. “From an efficiency perspective, you spend the first two years of the case fighting about the Tax Injunction Act, not even getting to the merits. To me, it just seems an inefficient way to get there.”
Jordan questioned in correspondence with Tax Notes whether getting state tax challenges involving federal or constitutional issues into federal courts really would allow the cases to move forward faster. Bringing suits in federal courts also requires attorneys to be admitted to the federal court system, “which is not universal, thereby cutting down the number of qualified attorneys available to litigate a matter,” Jordan added.
“If the TIA is expanded to allow for federal constitutional questions, I am not sure federal judges are any more qualified or have any more experience with duo process/commerce clause issues,” said Jordan. Similarly, federal judges “may or may not have more SALT experience than their state brethren.”
“I would prefer to be before a judge that understands the issues,” Jordan stated.