Martin v. Lafountain, Record No. 0971-22-3 (Va. Ct. App. Dec. 12, 2023)
In this brief opinion, the Court of Appeals addresses taxpayer standing.
Facts. After the Commissioner of Revenue for the City of Roanoke declined to impose business taxes on the owner and lessee of a halfway house, Mary Martin, the taxpaying owner and resident of a nearby property, petitioned the circuit court for declaratory relief. The Commissioner filed a demurrer arguing that Martin lacked standing to bring the petition; Martin argued that she had standing as a local taxpayer. The circuit court agreed with the Commissioner, and Martin appealed.
Issue. Whether a person has standing as a local taxpayer to challenge a local government’s decision not to impose taxes.
Holding. No. There is no authority establishing a taxpayer’s right to challenge the non-imposition or non-collection of a tax.
Notes. To establish standing, a plaintiff must show that their “rights will be affected by the outcome of the case.” While paying taxes does not ordinarily confer standing to challenge unlawful government actions, the common law establishes a taxpayer’s right “to challenge the legality of expenditures by local governments” because they have a personal stake in those expenditures. Here, however, Martin did not challenge the legality of a local government expenditure, but the legality of the local government’s failure to tax a third party. Further, her claim that the failure to collect taxes means that there is less money for the local government to spend is “wholly speculative” and nonspecific to her. Without more, this is insufficient to establish standing.