- 7 -
stated:
Legislatures have especially broad latitude in creating
classifications and distinctions in tax statutes. More
than forty years ago we addressed these comments to an
equal protection challenge to tax legislation:
“The broad discretion as to classification
possessed by a legislature in the field of taxation has
long been recognized. * * * The passage of time has
only served to underscore the wisdom of that
recognition of the large area of discretion which is
needed by a legislature in formulating sound tax
policies. * * * Since the members of a legislature
necessarily enjoy a familiarity with local conditions
which this Court cannot have, the presumption of
constitutionality can be overcome only by the most
explicit demonstration that a classification is a
hostile and oppressive discrimination against
particular persons and classes. The burden is on the
one attacking the legislative arrangement to negative
every conceivable basis which might support it.”
Madden v. Kentucky, 309 U.S. 83, 87-88 (1940);
(footnotes omitted).
Thus, Congress has broad authority to grant one class of
taxpayers deductions not available to another, as well as to
recognize differences between various kinds of business. See
Brushaber v. Union Pac. R.R., supra at 24-25, and the provisions
held constitutional therein (for example, upholding the
constitutionality of the corporate income tax, and observing that
“the due process clause of the 5th Amendment * * * [does not
limit a tax imposed on a class of taxpayers unless it] was so
wanting in basis for classification as to produce such a gross
and patent inequality as to inevitably lead to the same
conclusion [i.e., an arbitrary confiscation of property].”); High
Plains Agric. Credit Corp. v. Commissioner, 63 T.C. 118, 127
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