Thanks, that clarifies. I will now restrict my objection to the fact that the majority decision was a stretch, not for any incoherence I had previously detected. 
They can argue the decision was wrong just like I can say I think a bunch of other Supreme Court decisions were wrong. But the Supreme Court is the last word on this issue. If they say it’s Constitutional, than for practical purposes it is unless they make a different ruling later.
I think I understand your point now. Like it or not, they were referring to precedent. A tax could be so large that it was deemed to be intentionally coercive, to serve a purpose other than “to provide for the support of government.” In other words, a penalty disguised as a tax, with the primary intention of discouraging something (not principally to support government spending).
The reverse, ISTM, does not logically follow. The smaller a penalty becomes, the less effective / coercive it is, that’s true. But it doesn’t somehow turn into a tax if its primary purpose was never that of a tax.
Well, according to well established precedent, it does.
That doesn’t seem to contradict their principal point, though, unless I’m misunderstanding yours. In practical operation, this law identified a requirement and imposed a penalty for those who did not comply. We can call it whatever we want, but it’s a penalty, not a tax, as a matter of practical operation.
So dollar by dollar, we necessarily at some point pass from a tax to a penalty; but, take away dollar by dollar, we could never move from a penalty to a tax? Is this a reasonable position? Can you think of other areas in life where this is the case? (Not a rhetorical question. Maybe I’m missing something wicked obvious.)
But we’ve already established that the primary purpose doesn’t matter. We can whisk it away with a quick appeal to some other nebulous concept like “being onerous” or “coercive”.
I don’t think it’s a mathematical exercise so much as one of intent. Or inferred intent. Something doesn’t “trip the penalty meter” at a certain dollar amount. A high tax could just be a high tax, one that was stupidly set too high. But a “tax” could be intentionally set at a level that lets it serve as a penalty.
Don’t think of it as a process of slowly raising a tax until it becomes a penalty. Most typically it would be set high at the start, for the primary purpose of coercing, driving behavior away from what the taxing authority could not otherwise make unlawful. An end-around to render something “illegal” that is not really illegal. Or so the courts have decided in some cases. You could envision such a scenario, right?
A penalty set too low is stupid, that’s true. But if the penalty was installed to coerce, to drive behavior, etc., then it’s a penalty. Maybe an ineffective one, but a penalty nonetheless. If its purpose wasn’t* principally* to support government spending, it ain’t a tax.
The primary purpose does matter. “[A] tax is an enforced contribution to provide for the support of government; a penalty . . . is an exaction imposed by statute as punishment for an unlawful act.”
Yes: some taxes are penalties. Necessarily, then, there are some penalties that are taxes. I know of no principle which would forbid this conclusion, except that there is some crossover point, where we would have misnamed a penalty a tax. If there is a crossover point, then we can pass it in either direction, from tax to penalty and back again.
Of course, the dollar-by-dollar comment is just to flesh out the underspecified nature of “taxes” and “penalties.” Either taxes and penalties can be identical, in which case the identification of a tax as a penalty has resolved the question of whether a penalty can be a tax; or, there is a scale from tax to penalty, in which case we could conceivably slide along it. Either scenario resolves the dissent’s problem. What is the third way which renders the dissent sensible?
Then “sin taxes” really penalties… penalties so slight as to be taxes, and the question is still resolved against the dissent’s queer claim.
Then a tax could never be a penalty.
I don’t think there’s a crossover point so much as there is a particular intention, and that intention is most easily inferred when the penalty disguised as a tax is onerous. Someone trying to sneak through a penalty-disguised-as-a-tax who set that “tax” too low might well go undiscovered. But he also wouldn’t have set up much of a penalty. Too bad for him. The point is this: a tax is intended to collect money for government spending, and a penalty is intended to punish behavior that the government wants prohibited. Courts have deemed certain onerous taxes as being penalties because of their materiality. I would think a poll tax might be such a thing. An evil-intentioned poll tax set too low doesn’t as effectively achieve its objective, but it’s still a penalty if that’s what it’s designed to be.
The notion that a penalty is different than a tax is well-established in law, so the dissent is sensible in that regard. They identify that Obamacare shares the attributes of the legal understanding of a penalty–i.e., it identifies a requirement (the mandate) and sets a punishment for those who don’t comply. Still sensible. It adds color to the argument by pointing out that in law there is precedent for a tax being deemed a penalty, but literally none for the opposite. You may disagree with the logic of all prior legal decisions that make that statement so, but that is what it is.
But I still see nothing illogical in it, even if it’s not necessary for their argument. Taxes don’t automatically become penalties because they are onerous. But a subset of onerous taxes are those that were designed specifically to penalize people. Penalties don’t become taxes because they are set low. They just become less-effective penalties.
I think many sin taxes are penalties. But if they are set low, they are poorly designed sin taxes.
Why not? If it’s designed to discourage behavior, it’s a penalty, whatever we call it.
This won’t square well with the crackpots who come out of the woodwork regularly to declare that an income tax is unconstitutional.
I don’t quite understand the reasoning behind either notion, since the Constitution vests in the Federal government the right – yes, the right – to tax. Read Alexander Hamilton writing as “Publius” in Federalists 30-36 for the rationale behind an unlimited right of the central government to tax.
As to the bit of the Constitution you want for the government’s right to tax, it’s Article 1, Section 8:
Now, we have decided that a tax on alcohol (for example) need not be levied on non-drinkers. In other words, so long as you don’t make it (from the Congressional level) 5% in Michigan and 10% in Montana, it’s fine to tax alcohol, even though non-drinkers do not pay the tax.
It strikes me that a tax on would-be free riders is just fine, as the second clause (after the semi-colon) is a matter of uniformity state-to-state, not any demand that all taxes be flat taxes and equally tax people regardless of their behavior.
What is the argument for unconstitutionality?
And what exactly is the rightist constitutional argument for getting rid of the entirety of the Judiciary (in selected cases,) substituting the phrase “A bunch of internet crackpots will be the supreme court of the land” or “One or another whack-job rightist candidate will be the supreme court of the land”?
When something’s voted into law by the Congress, signed by the President, then upheld by the Supreme Court, it seems a bit strange to call it – still – unconstitutional. The courts decide that, not random internet crackpots. There’s no “internet crackpot review” written into the Constitution. There’s Judicial Review.
:smack::smack::smack:
Bucket o’ facepalm.
Paul Ryan looks like Eddie Munster. Rand Paul looks like…well the Internet is split, but possibly Bilbo Baggins, Tony Hayward, or Rick Astley.
I don’t disagree with it. This is not what I am disagreeing with.
Because you didn’t get to the illogical part.
Well, I think this doesn’t really make sense. This one-way road from tax to penalty seems more striking than the position the dissent is disagreeing with.
All taxes except poll taxes discourage behavior.
I guess I’m not making my point clearly enough (though you may well still disagree). My point is that your rebuttal is based on what you see as the faulty predicate, “There is a $$$ tipping point that transforms any tax into a penalty.” That is indeed faulty and also is a straw man. There is no unavoidable tipping point, that level (perhaps different for each tax) where in every instance a revenue collected transforms from tax into penalty. Taxes can be onerous and not a penalty. I consider Federal income taxes at once onerous and wasteful. But I don’t deny Congress has the power to levy such a tax, and to call it a tax, since they basically just want the dough so they can spend it.
A subset of onerous “taxes” are those that were specifically installed as law to serve as a penalty. The “tax’s” revenue collection aspect is secondary. But not all onerous taxes are penalties (as the legal term of art) and therefore your assumption that since there’s always some point up the scale that changes a tax into a penalty (there isn’t), there must be that same point on the return down the scale that changes a penalty into a tax. A tax is to collect revenue that the government can spend. A penalty is to impose a punishment. The fact that we might be able to point to separate instances where each respectively cost a citizen $50 doesn’t make them in any other way equivalent.
True. But as a secondary and incidental outcome. The reason we have taxes (the dissent would argue) is because the government needs the dough. Any other consequence is coincidence.
BTW, I don’t think this particular point provided the bulk of the weight in the dissenting opinion, not even close to it. They could have omitted this portion entirely, I think, and their logic was still sound.
Not exactly. Roberts’ argument was that the penalties associated with not purchasing health insurance under the individual mandate COULD BE “characterized as a tax”, and that as a result, fell under Congress’ constitutional taxing authority.
His actual words: "Congress’s choice of language…does not require reading §5000A as punishing unlawful conduct. It may also be read as imposing a tax on those who go without insurance.”
“…DOES NOT REQUIRE reading…as a punishment…MAY ALSO BE READ AS imposing a tax”.
Not “IS a tax.”
He went on: “…if the mandate may reasonably be characterized as a tax, it must still comply with the Direct Tax Clause." (which he found it does). And crucially, "…“[a] tax on going without health insurance is not like a capitation or other direct tax … It therefore need not be apportioned so that each State pays in proportion to its population.”
Note the word IF in that first sentence.
Translation: NOT necessarily a tax but COULD be characterized as one for the purposes of deciding Congressional/constitutional authority to impose it.
Fines for not having valid automobile insurance are not, by any reach of the imagination, taxes. Neither are parking tickets. Both can be avoided/opted out of simply by having valid insurance coverage or parking legally. Both are PENALTIES.
Apparently who collects it if I’m reading the MajOp right. Let’s take an example that we know is constitutional - state-required auto insurance in California. If you are caught without insurance and you pay the fine to the DMV it is a penalty. If you pay it to the Franchise Tax Board it is a tax.
Imho when someone says a given law is unconstitutional, they are saying that if they were a supreme court Justice, they would vote to overturn it. So when Rand Paul and others say that they still believe the law is unconstitutional, despite the supreme court majority opinion, they are just saying they disagree with that opinion. They aren’t recommending that the everyone should start acting ike the law has been overturned.
It’s the underlined passage that relates to income tax. The drafters of the Constitution were concerned that Congress might be dominated by particular states, who would then impose heavy taxation in a non-uniform fashion on the smaller states. The underlined passage prevented that, by providing that taxes had to be uniform throughout the US.
Then, in 1895, the Supreme Court held, in Pollock v. Farmers’ Loan & Trust Co., that income taxes were not uniform, because the incidence of the tax varied among the states, depending on the income levels of individuals. The federal income tax was therefore unconstitutional.
That in turn resulted in the Sixteenth Amendment, permitting income taxes:
However, that amendment only does away with the uniformity requirement for income taxes; it still applies to other federal taxes, which must be apportioned uniformly. The argument appears to be that the health insurance penalty/tax is not a tax on income, and therefore has to comply with the uniformity/apportionment requirement.
Oops - just realised I forgot to quote the other part of the Constitution that the SCOTUS relied on in striking down the income tax:
so federal direct taxes have to be proportional to the population of each state. the 16th Amendment changed that requirement for income taxes.
Moved Elections --> GD.
Excuse the nitpick, but Roberts wasn’t making an argument. He was making a ruling, a decision. Judges/Justices don’t make arguments. The lawyers arguing in front of them do.
