588
Opinion of the Court
stitutions participate. Indeed, if we view the issue solely from the State's perspective, it is equally reasonable to use discriminatory tax exemptions as a means of encouraging the growth of local trade. But as our cases clearly hold, such exemptions are impermissible. See, e. g., Bacchus Imports, Ltd. v. Dias, 468 U. S. 263, 273 (1984). Protectionism, whether targeted at for-profit entities or serving, as here, to encourage nonprofits to keep their efforts close to home, is forbidden under the dormant Commerce Clause.19 If there
is need for a special exception for nonprofits, Congress not only has the power to create it,20 but also is in a far better position than we to determine its dimensions.21
VI
Rather than urging us to create a categorical exception for nonprofit entities, the Town argues that Maine's exemption statute should be viewed as an expenditure of government money designed to lessen its social service burden and to foster the societal benefits provided by charitable organizations. So characterized, the Town submits that its tax exemption scheme is either a legitimate discriminatory subsidy
19 Contrary to Justice Scalia's suggestion, nothing in our holding today "prevent[s] a State from giving a tax break to charities that benefit the State's inhabitants." Post, at 595. The States are, of course, free to provide generally applicable nondiscriminatory tax exemptions without running afoul of the dormant Commerce Clause.
20 See n. 8, supra.
21 We must admit to some puzzlement as to the force of the argument underlying Justice Scalia's dissent. On the one hand, he suggests that a categorical exemption of nonprofit activities from dormant Commerce Clause scrutiny would be proper. Post, at 607-608. Yet at the same time, he makes a great effort to characterize this statute as being so narrow that, whatever the appropriate generally applicable rule, the dormant Commerce Clause ought not to apply here. Post, at 598. As we have explained, the argument in favor of a categorical exemption for nonprofits is unpersuasive, and we disagree with Justice Scalia's characterization of this statute's effects. Accordingly, we reject his position on either of these theories.
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