Under the Voucher Radar

By Kevin G. Welner

Tuition tax credits for private schools, a policy increasingly popular among advocates of school choice, present us with several riddles. When is a charitable donation not charity? When is a public expenditure not public spending? And what policy can be virtually indistinguishable from a voucher in its effects, but be treated by courts as something very different? The answer to this last question, and the key to answering the first two, is a type of tuition tax credit I call a “neovoucher.”

Traditional vouchers offer parents government funding for tuition at nonpublic schools. Neovouchers rely on a more complicated, and thus less transparent, process:

First, a taxpayer donates money to a private, nonprofit organization. Then that organization bundles the donations and issues them to parents as vouchers toward tuition at nonpublic schools. Finally, the taxpayer-donor receives some or all of the donated money back, in the form of a tax...