Last week, students from Fordham Law’s Tax Clinic, under the guidance of Professor Elizabeth Maresca, filed suit in New York County Supreme Court, challenging a state tax statute that strips tax debtors of their driver’s licenses.
The Tax Clinic’s case questions a 2013 New York State law that allows the Department of Taxation and Finance to order the Department of Motor Vehicles to suspend the driver’s license of anyone who owes the state more than $10,000 in back taxes. Although initially a success story for the state, drawing in millions in revenue, the law had a hidden cost, which the work of the Tax Clinic sought to highlight.
Building on legal work done by previous Tax Clinic students, Xiaoxi Liu ‘17, Juan Cordon ‘17, and Fazim Bacchus ‘18, under Professor Maresca’s guidance, adopted the case of a man whose license was about to be suspended, owing to a $16,000 tax debt that he had no means to repay. On October 21, they filed a complaint against the New York State Department of Taxation and Finance. The complaint challenges as unconstitutional the practice of suspending the driver’s licenses of low-income citizens burdened with tax debts.
“Our client uses his license to care for his mother,” said Cordon. “The Department of Taxation and Finance does offer a restricted license for those who have their licenses suspended, but it can only be used for going to employment, school, and medical appointments. You’re not allowed to drive for any other reason. You’re just being punished, and there’s no real purpose being served by the law here.”
Tax Clinic students worked with Professor Maresca to develop several constitutional challenges to the law, arguing that it deprives their client of his rights to due process, equal protection, and protection from excessive fines under the Eighth Amendment.
“We think the strongest part of our complaint is the due process argument,” said Liu. “But I think there’s also a pretty strong argument in the Eighth Amendment as well.”
During the 2014–2015 school year, Tax Clinic students Adil Ahmed ’16, Ivy Chiu ’15, Robert Lyons ’15, and Brandon Younesi ’15 succeeded in representing the same client, but their victory was short-lived. The Department of Taxation and Finance agreed to allow the client to keep his license after the clinic filed suit but recently threatened to revoke it once more after it came to light that he had secured part-time employment.
“Basically, the problem with this statute is that there are no procedures whereby a person can argue their inability to pay their taxes,” said Maresca. “If they’re simply unable to pay their taxes, New York State should put their debt on hold until their financial situation changes. Without that, you’re basically punishing someone just because they’re poor.”
The Tax Clinic’s client had accumulated an insurmountable tax burden after his business unraveled during the recession. A bout of severe illness cemented the man’s misfortune. Without a driver’s license, he would be unable to care for his ailing mother.
By filing this suit, the Tax Clinic’s students hope to compel the state to permanently change the way low-income individuals are treated under the law.
“If you’re New York State, and you’re suspending the license of someone who does have the ability to pay, it’s phenomenal,” said Cordon. “But with regards to our specific case, it’s just punishing someone because they can’t pay, and that’s why we’re concerned.”