The Corner

Re: Solicitor General Called Mandate a Tax

Noah Glyn compiles video from Supreme Court oral argument pointing out that the Obama administration has described the individual mandate as a tax. In my Forbes piece today, I recount dozens of examples of this from the administration’s briefs in the various appellate courts. An excerpt:

Here’s how Acting Solicitor General Neal Katyal put it in his February 2011 brief to the Fourth Circuit in Virginia v. Sebelius (p. 36): “The minimum coverage provision,” that is, the individual mandate, is “independently authorized by Congress’s taxing power…The minimum coverage provision appears in the Internal Revenue Code and operates as a tax. It is projected to raise billions of dollars in revenue each year.”

He reiterates this point later in the brief (p. 72): “The practical operation of the provision is a tax. Individuals who are not required to file income tax returns for a given year are not required to pay the penalty…The amount of any penalty is calculated in part by reference to household income for federal income tax purposes; it is reported on the individual’s federal income tax return for the taxable year and is assessed and collected in the same manner as certain other federal tax penalties…In short, the minimum coverage provision is a tax in both administration and effect.”

Katyal makes the point repeatedly in his reply brief in the same case. “The minimum coverage provision operates as a tax and will produce billions of dollars in annual revenue,” he declares on page 46. “There is no doubt that the ‘practical operation’ of the minimum coverage provision is as a tax.” Katyal notes (p. 52) that “the taxing power was expressly invoked in the Senate to defeat constitutional points of order against the minimum coverage provision…And during the legislative debates, congressional leaders defended the provision as an exercise of the taxing power.”

I described the ludicrousness of the administration’s (and now John Roberts’) position — that the mandate was a tax under the Constitution, but a penalty under the Anti-Injunction Act, in this March post at Critical Condition:

The highlight of the session was when President Obama’s solicitor general, Donald Verrilli, got up to articulate the administration’s position, which was that the mandate wasn’t a tax, for the purposes of the Anti-Injunction Act, and yet also that “the minimum-coverage provision of the Affordable Care Act is an exercise of Congress’ taxing power.”

To which Justice Alito said: Huh?

“General Verrilli, today you are arguing that the penalty is not a tax,” Alito said. “Tomorrow you are going to be back, and you will be arguing that the penalty is a tax. Has the Court ever held that something that is a tax for purposes of the taxing power under the Constitution is not a tax under the Anti-Injunction Act?”

“No, Justice Alito,” replied Verrilli.

Verrilli kept misspeaking, describing the “penalty” as a “tax.” “Why do you keep saying tax?” asked Justice Breyer, after which Verrilli started referring to the mandate as a “tax penalty.”

Avik Roy is a Senior Fellow at the Manhattan Institute and author of The Apothecary, the Forbes blog on health-care and entitlement reform. He is a member of Mitt Romney’s Health Care Policy Advisory Group. You can follow him on Twitter at @aviksaroy.

Avik RoyMr. Roy, the president of the Foundation for Research on Equal Opportunity, is a former policy adviser to Mitt Romney, Rick Perry, and Marco Rubio.


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