Skip to comments.The ACA: A Tax Disguised as a Penalty
Posted on 07/05/2012 10:37:46 AM PDT by 92nina
As poet James Whitcomb Riley wrote, if it looks "like a duck, swims like a duck, and quacks like a duck, call that bird a duck." The individual mandate upheld by SCOTUS last week not only looks like a tax, functions like a tax, but it is also enforced like a tax. Any cleverly veiled description of the individual mandate as a "penalty" and thus not a tax, blatantly overlooks the fact that it is a tax.
Thanks to Congress' legal contortions of our system of jurisprudence, the individual mandate has been allowed to limbo under the bar of judicial standing as just a "penalty," and find sanctuary as a "tax" in the arms of Article I Section 8 of the Constitution.
To clarify, there are two key points which the Government and its legal counsel advance, which amount to hypocritical interpretations of their own legislation. First, in order for SCOTUS to hear the challenge to the ACA, the Government had to show that the penalty contained in the legislation was not a tax, such that it is not barred by the Anti-Injunction Act. Second, the method in which the Government was able to successfully argue the merits of the ACA and the penalty it contains, was to prove that Congress could enact such legislation through its power to tax. In short, to get the case heard the penalty is not a tax, yet to get the legislation passed, the penalty is a tax.
Prior to examining the merits of the case, the Government had to overcome the Anti-Injunction Act's bar of suits brought "for the purpose of restraining the assessment or collection of any tax." In other words, for purposes of standing, the ACA's penalty had to be shown by the Government not to be a tax. If the penalty was shown to be a tax, the parties would not have had standing, as the tax is not yet in place and thus no cognizable injury is realized, such that there is no injury or issue for the court to rule on.
Because opposing council on both sides of the health care debate refused to argue that the penalty was a tax, SCOTUS was forced to appoint its own outside council or "amicus curiae" to argue for the penalty being a tax. To quote the court appointed council, "even though Congress did not label the shared responsibility payment a tax, we should treat it as such under the Anti-Injunction Act because it functions like a tax." The amicus brief further states, the penalties "shall be assessed and collected in the same manner as taxes."
However compelling the argument that the penalty is a tax, and thus barred by the Anti-Injunction Act, SCOTUS found for purposes of standing, the language crafted by Congress evidenced a penalty, not a tax, and the suit was not barred from being heard on the merits.
Once the Government was able to overcome the hurdle of the Anti-Injunction Act, however, their approach took an immediate 180. The Government was prepared with two arguments: (1) First, that Congress had the power to enact the mandate under the commerce clause; and (2) Second, "that if the commerce power does not support the mandate, we should nonetheless uphold it as an exercise of Congress' power to tax."
At first glance, these arguments seem destined to fail, and indeed SCOTUS found Congress could not enact such legislation under its first argument as the Commerce Power did not provide for such legislation. However, the second argument, that Congress could enact such legislation under its Power to Tax, was successful. To any layperson this seems odd, as the Government's principle argument, which allowed the legislation to pass the bar of the Anti-Injunction Act, was that the penalty was not a tax. Yet, the Government's principle argument in seeking to enact the legislation was that it was a tax and as such Congress could enact the legislation under its Power to Tax.
The Government was thus able to get the ACA in to court as a penalty, not a tax, while simultaneously getting the ACA passed by arguing the penalty was, for all intents and purposes a "tax."
While the Government's argument is an impressive display of legal gymnastics, it opens our legal system up to situations in which Congress can hypocritically craft two versions of the same legislation in a manner that benefits the passage of legislation, even though it is based on two contrary and conflicting logical interpretations.
Read more: http://atr.org/aca-tax-disguised-penalty-a7015#ixzz1zlqcHGzI
Oh really? And just part of the COnstitution’s taxong authority does thos fall under? It is NOT an income tax. It is NOT an excise tax. It is not a direct tax. So prey tell me what type of tax is it? Roberts is an ass. He is a coward and a traitor. He is anticonstitutional
I believe that very soon most red states will opt out.
It is a TAX for failing to spend your money as THEY SEE FIT.
That’s slavery, folks!
They’ve arrogated unto themselves 100% of your income stream.
“In short, to get the case heard the penalty is not a tax, yet to get the legislation passed, the penalty is a tax.”
The first claim is true, the second is manifestly false. If it had been labeled a tax, the bill (which just barely passed both House and Senate) never would have passed in the first place. This is just one problem with Roberts’ weak logic, as it allows Congress to duck political accountability in enacting a tax, yet allows them after the fact to get away with it by relabeling what they called a “penalty” a “tax.”
Roberts further undercut his own logic by arguing that even though the penalty really was a tax, it was neither a direct tax nor a tax for purposes of the Anti-Injunction Act. Some claim Roberts humiliated Congress by exposing their hypocrisy and forcing them in the future to be more honest in labeling. But the decision does quite the opposite. It actually encourages them to label taxes “penalties” knowing full well the Court will later rescue them from their perfidy.
The “direct tax” issue hasn’t been sufficiently criticized IMHO. As another posted noted, this surely isn’t an income tax or excise tax. Thus, it must be a direct tax, but if so, then it fails constitutional muster in how it is apportioned among the people. In short, Roberts was too clever by half in arguing that what looked like a penalty was really a tax and then failing to follow that determination through to its logical conclusions. If the mandate truly was a tax, either the Court could not have ruled on the case, or, better yet, it should have ruled it a direct tax that exceeded the strict constitutional boundaries that circumscribe such levies.
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