Today was the first of three days of oral arguments, totaling six hours, on the Affordable Care Act, a/k/a “Obamacare,” before the Supreme Court of the United States. The issue today was whether the “penalty” imposed by the statute for failure to obtain health insurance, in contravention of the “individual mandate” aspect of the statute, is in fact a “tax.” If so, the Tax Anti-Injunction Act of 1867 would forbid any challenge to the individual mandate until after the “tax” has been paid, and the mandate (and the accompanying payment) does not go into effect for several years. If the Court finds the payment to be a “tax,” the current challenge to the individual mandate would have to be dismissed as premature.
None of the lower courts accepted the argument that the payment is a “tax.” All of the parties before the Court reject that notion. They all want a decision on the Affordable Care Act now. But since this is a potentially dispositive threshold issue, the Court appointed an attorney to make the argument that the payment is a “tax.”
As the argument transcript reflects, most of the Court did not seem receptive to the “tax” argument. Justice Breyer was particularly outspoken in opposition to that contention, and most if not all of the other Justices seemed similarly dubious. Justice Breyer noted, among other things, that Congress used the word “penalty,” not “tax,” in this regard.
When it was the turn of the United States, Justice Alito immediately noted that the Government was arguing today that the “penalty” was not a “tax” for purposes of the Tax Anti-Injunction Act, but that the Government will argue tomorrow that it is a “tax” for purposes of the constitutional argument that will be heard at that time. The Government offered a distinction of the two purposes that may become more developed when the constitutionality of the individual mandate is argued tomorrow.
It seemed, before the argument, unlikely that the Court would use this issue as a way to dodge a decision on the constitutional merits of the Affordable Care Act. No lower court in any of the health care cases before the Court had adopted this argument. After the argument that occurred, despite the impressive efforts of appointed counsel in making the “tax” argument against a fairly strong wind in his face, it would appear that the Supreme Court will not adopt that argument either, but will reach the merits.