Author: Daniel Himebaugh
In 2009, before the Patient Protection and Affordable Care Act (colloquially, "Obamacare") became law, President Obama was asked whether a monetary penalty assessed against people who do not buy government-approved health insurance is a "tax." The president, perhaps recalling his campaign pledge to avoid raising taxes on the middle class, said no. However, when numerous lawsuits emerged challenging the constitutionality of the PPACA, the president's lawyers decided that they could more easily defend the penalty if they described it as a "tax" for purposes of constitutional analysis. This taxing power argument, reported The New York Times, became the "linchpin of [the federal government's] legal case in defense of the health care overhaul and its individual mandate."
In a new law review article, The Individual Mandate and the Taxing Power (Northern Kentucky Law Review, forthcoming), tax law professor Erik M. Jensen thoroughly rebuts the claim that Congress's constitutional taxing power authorizes the PPACA's individual mandate provision. Jensen systematically rejects the government's taxing power argument, and outlines how (1) Congress's taxing power provides no authority for requiring the acquisition of health insurance; (2) the penalty for failure to acquire health insurance should not be treated as a tax at all; and (3) if the penalty is treated as a tax, it is an unconstitutional capitation tax.
In one of the more entertaining passages, Jensen remarks:
The argument under the Taxing Clause is being advanced because of nervousness about whether the Commerce Clause provides sufficient authority for the individual mandate. The argument smacks of desperation. If, despite the extraordinary expansion in the scope of the Commerce Clause in twentieth-century jurisprudence, proponents of the mandate are still nervous about constitutional questions, we should all be nervous.
In addition to Jensen's article, you can learn more about why the government's taxing power argument fails by reading PLF's amicus brief in support of Virginia's health care challenge.