The Corner

Oklahoma: Obamacare Tax Haven?

Admittedly, “Oklahoma Coolers on the prairie” just doesn’t have the same appeal as “pina coladas in the Caymans.” But the Sooner State might well be the next hot tax refuge, thanks to the state’s new legal challenge to the Obama health law.

The legal argument is complex, and you can read about it in my piece today. But the main point is that the Affordable Care Act doesn’t allow the federal government to impose Obamacare’s taxes and fees in states with federally facilitated exchanges. So by refusing to set up a state-run exchange, Oklahoma would spare its citizens and businesses from these costly penalties. Other states could do the same, too.

If Attorney General Scott Pruitt prevails, states without their own exchanges would have a huge economic advantage over the states that had created them. And, of course, this case would also undermine the individual and employer mandates, one of the central components of the whole health law.

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