Regulatory Taxings

100 Pages Posted: 9 Feb 2004

Date Written: February 20, 2004


The tension between an expansive reading of the Takings Clause and the state's virtually unlimited power to tax has been the subject of repeated scholarly comment but has received little systematic exploration. Some scholars, most notably Richard Epstein, have attempted to use the tension between takings law and taxes as an argument against the legitimacy of taxation as it is presently practiced. This approach, however, has failed to gain a significant following. Instead, there is a broad legal consensus that legislatures have virtually unlimited authority to structure and allocate tax burdens. Nevertheless, every attempt to formulate a "Reconciling Theory," that is, a theory that would reconcile the prohibition of takings (understood to include the exercise of eminent domain as well as certain regulations of property) with such a broad tax power, yields a substantial category of Regulatory Taxings, government actions that, though they would likely be viewed as takings under current doctrine, cannot be distinguished from taxes under the particular Reconciling Theory. The persistence of the category of Regulatory Taxings demonstrates that present takings doctrine is far too broad to fully reconcile with the longstanding constitutional norms governing taxation. Given the overwhelming consensus that existing taxation practices are largely constitutional, this observation in turn suggests a need to adopt a narrower understanding of the Takings Clause. At a minimum, any regulation that can easily be translated into a permissible tax should not count as a taking in need of compensation. Moreover, generally applicable regulations and regulations of fungible property should rarely be treated as takings.

Keywords: property, takings, taxation, regulatory takings, fifth amendment, constitutional law, eminent domain, land use, just compensation

JEL Classification: K11, Q15, Q24, R14, R31, R52

Suggested Citation

Penalver, Eduardo Moises, Regulatory Taxings (February 20, 2004). Available at SSRN: or

Eduardo Moises Penalver (Contact Author)

Cornell University - Law School ( email )

Myron Taylor Hall
Cornell University
Ithaca, NY 14853-4901
United States

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