The U.S. Supreme Court appeared sympathetic on Monday toward a bid by an arm of a Catholic diocese in Wisconsin for a religious exemption from the state's unemployment insurance tax in the latest religious rights case to reach the justices.

The Supreme Court signaled Monday it is poised to side with Catholic Charities in a dispute over whether religiously affiliated groups are entitled to an exemption from certain state taxes, a decision that could expand the types of groups that would receive a break under the First Amendment.

The Supreme Court on Monday appeared sympathetic to the argument by a Catholic Charities chapter that Wisconsin violated the Constitution when it refused to give the group the same exemption from the state’s unemployment tax that it provides to churches,