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AffordableCareAct 12 - 25 Jan 2012 - Main.RohanGrey
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| | Discussion of statutes
begins always with the statutory language. Much water has been
flowed under the bridge below before Arlene even mentions the | | | "The difference between a tax and a penalty is sometimes difficult to define, and yet the consequences of the distinction in the required method of their collection often are important. Where the sovereign enacting the law has power to impose both tax and penalty, the difference between revenue production and mere regulation may be immaterial, but not so when one sovereign can impose a tax only, and the power of regulation rests in another. Taxes are occasionally imposed in the discretion of the Legislature on proper subjects with the primary motive of obtaining revenue from them and with the incidental motive of discouraging them by making their continuance onerous. They do not lose their character as taxes because of the incidental motive. But there comes a time in the extension of the penalizing features of the so-called tax when it loses its character as such and becomes a mere penalty, with the characteristics of regulation and punishment. " | |
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> | http://bit.ly/wU8de9 | | | Source of quotation? | |
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> | apologies - above | | | -- RohanGrey - 24 Jan 2012
tax n. a governmental assessment (charge) upon property value, transactions (transfers and sales), licenses granting a right, and/or income. (http://legal-dictionary.thefreedictionary.com/tax). | | | responsible has not occurred?
-- ArleneOrtizLeytte - 25 Jan 2012 | |
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> | It would seem that the distinction between the subsequent "penalty" and the initial "tax" as used in 26(F)68(B)(1) Section 6671 and 26(F)68(B)(1) Section 6672 is that the penalty carries the option of being supplemented by additional penalties above the original amount as determined by the particular piece of legislation that authorized it - which in itself is i guess a form of "non-compliance" tax. Taft's attempt to associate "penalties" with executive regulation power (as opposed to legislative taxation power) seems counter to the actual examples of penalties as described in that part of the tax code - all of them lay out specific rules and amounts for determining what penalties to impose, rather than leaving it to regulatory discretion (with a few exceptions for possible waivers). This might be an attempt to ensure that the "penalties" are dispersed uniformly as articulated by the Constitution, which would go towards the case that it is merely another form of tax.
-- RohanGrey - 25 Jan 2012 |
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AffordableCareAct 11 - 25 Jan 2012 - Main.EbenMoglen
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| | Discussion of statutes
begins always with the statutory language. Much water has been
flowed under the bridge below before Arlene even mentions the | | | Please note that the text of Act refers to the mandate as a penalty, not as a tax. See PPACA Sec. 1501(b). Further complicating the government's desire that the mandate be classified as a tax is that the legislative history of the Act indicates that the mandate was called a "tax" in earlier congressional drafts, but that the term "tax" was replaced with "penalty." (See Florida v. U.S. Department of HHS, 716 F.Supp.2d 1134 for a discussion about this.) | |
<
< | | >
> | How does that
"complicate" anything? Isn't Holmes' point that the words mean what
they do, and that the doing is not affected by the naming, because
in the end there are no operative distinctions between "tax,"
"penalty," and "tax penalty"? Surely no one will seriously argue
that it's unconstitutional to use the word "penalty" but
constitutional to use the word "tax." In which case, why does the
name matter at all? | | | -- HarryKhanna - 24 Jan 2012 | | | "The difference between a tax and a penalty is sometimes difficult to define, and yet the consequences of the distinction in the required method of their collection often are important. Where the sovereign enacting the law has power to impose both tax and penalty, the difference between revenue production and mere regulation may be immaterial, but not so when one sovereign can impose a tax only, and the power of regulation rests in another. Taxes are occasionally imposed in the discretion of the Legislature on proper subjects with the primary motive of obtaining revenue from them and with the incidental motive of discouraging them by making their continuance onerous. They do not lose their character as taxes because of the incidental motive. But there comes a time in the extension of the penalizing features of the so-called tax when it loses its character as such and becomes a mere penalty, with the characteristics of regulation and punishment. " | |
>
> | Source of quotation? | | | -- RohanGrey - 24 Jan 2012
tax n. a governmental assessment (charge) upon property value, transactions (transfers and sales), licenses granting a right, and/or income. (http://legal-dictionary.thefreedictionary.com/tax). | | | Then again, maybe this doesn't matter. Maybe taxes don't have to be tied to positive transactions. Does anyone know of other taxes that are based on a non-action? There is the estate tax, for instance. Dying isn't usually a choice, but the estate still gets taxed, regardless. Then again, death is definitely an event, as opposed to a non-event. | |
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> | So in your judgment
there would be something different about the situation in which
Congress says "Everyone (with the following exemptions) must pay the
following amount in additional income taxes, but we rebate the tax to
you if you maintain adequate minimum health coverage for your
family?" Then the tax would be on the income, and the choice about
whether to qualify for the rebate would determine the incidence of
the tax?
On the question of
taxes based on non-actions: If I sell my house for more than I paid
for it (or in some other cases, for more than the amount I am
imputed to have paid for it, even I did didn't do anything to
acquire it, which would be known as my "basis") I owe capital gains
taxes on it. But if I "roll over" by buying another house within 18
months, I am not required to pay capital gains taxes at all. Does
that mean that the capital gains taxes are based on my inaction in
not buying another house? Or was I penalized for not buying another
house? How, from a Holmesian point of view, could one tell?
| | | If we determine that money exacted on the basis on a non-event can't be termed a "tax," and that the Affordable Care Act falls under this head, then we'd have a problem with arguing in favor of the Act under the taxing power. Can we make solid determinations on these questions? | |
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> | Does a piece of
legislation have to use the word "tax" in order to be based on the
taxing power? If Congress passes a statute that amends the Internal
Revenue Code to set higher or lower penalties for particular taxpayer
actions, and it doesn't use the word "tax" but only "penalty," does
that statute not take its constitutional basis from the power to lay
and collect taxes? | | |
-- RyanBingham - 25 Jan 2012 |
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AffordableCareAct 10 - 25 Jan 2012 - Main.RyanBingham
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| | Discussion of statutes
begins always with the statutory language. Much water has been
flowed under the bridge below before Arlene even mentions the | | | -- RohanGrey - 24 Jan 2012 | |
>
> | tax n. a governmental assessment (charge) upon property value, transactions (transfers and sales), licenses granting a right, and/or income. (http://legal-dictionary.thefreedictionary.com/tax).
The usual notion of a tax is that it is something collected on the basis of positive events. Which is to say, you typically have a free choice about whether you will undertake the actions that will lead to a tax being collected from you. The fee that would be exacted under the Affordable Care Act (whether we call it a tax or a penalty) would be resting on a person's choice not to do something--that is, not to pay for insurance that they don't want. I have heard people argue that it is really a tax on the affirmative choice to be a "self-insurer," and not on the choice to refrain from buying insurance, but this line of argument strikes me as duplicitous. Failing to purchase something seems to be more of non-action than an action--even if that failure to purchase entails a plan to purchase a substitute at a later time. What do you think?
Then again, maybe this doesn't matter. Maybe taxes don't have to be tied to positive transactions. Does anyone know of other taxes that are based on a non-action? There is the estate tax, for instance. Dying isn't usually a choice, but the estate still gets taxed, regardless. Then again, death is definitely an event, as opposed to a non-event.
If we determine that money exacted on the basis on a non-event can't be termed a "tax," and that the Affordable Care Act falls under this head, then we'd have a problem with arguing in favor of the Act under the taxing power. Can we make solid determinations on these questions?
-- RyanBingham - 25 Jan 2012
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The detailed summary of the Act (dpc.senate.gov/healthreformbill/healthbill04.pdf) lists the payment as a penalty: "Beginning in 2014, most individuals will be required to maintain minimum essential coverage or pay a penalty of $95 in 2014, $350 in 2015, $750 in 2016 and indexed thereafter; for those under 18, the penalty will be one-half the amount for adults. Exceptions to this requirement are made for religious objectors, those who cannot afford coverage, taxpayers with incomes less than 100 percent FPL, Indian tribe members, those who receive a hardship waiver, individuals not lawfully present, incarcerated individuals, and those not covered for less than three months." Do the categories of objectors give us any indication as to whether it resembles a tax or a penalty? The fact that there are exceptions made for religious objectors indicates to me that the fee resembles a penalty more than a tax; I couldn't find many taxes out of which it was possible to opt out based on religious objection. It looks like you can do so with the social security tax if you have religious objections to being part of a social insurance system, but that doesn't seem to parallel the case here. |
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AffordableCareAct 9 - 25 Jan 2012 - Main.EbenMoglen
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>
> | Discussion of statutes
begins always with the statutory language. Much water has been
flowed under the bridge below before Arlene even mentions the
statutory language, only part of which she cited to a partial source.
The actual
Patient Protection and Affordable Care Act, P.L. 111-148, 124 Stat. 119,
was the document from which this discussion should have started. Not
some editorializations about "what the government wants," or
summaries of what judges said. This is law school. One of the
first lessons in it is that when discussing statutes, one always
starts from the text.
You can find the relevant provisions 124 Stat. at 242 et
seq. (p. 124 of the GPO print of the bill). You probably want to pay
careful attention to section 5000A(g), 124 Stat. at 249 (p. 131 of
the GPO print). You might also want to consult Chapter 68,
Subchapter B of the Internal Revenue Code.
| | | The government wants the individual mandate to be a tax, not a penalty, for two reasons.
1. Additional Congressional Authority Under Art. I, Sec. 8 | | | What bothers me is the use of communitarian language ("shared responsibility") as a guise for the creation of a stable marketplace ("economies of scale"). Perhaps that's why the word "penalty" was used instead of "tax": to instill the feeling of guilt in the uninsured. Breaking the tax code does not instill the sense of committing a crime against your community. | |
>
> | Does anyone actually
think the emotions of the public are affected by the text of a
statute with which we have already established that no one is at all
familiar, even thoughtful well-educated persons such as yourselves?
Why not choose some more probable perhapses, as for example that a
"penalty" is a term of art in tax law, meaning a payment collected
from the taxpayer after an earlier payment for which the taxpayer is
responsible has not occurred? | | | -- ArleneOrtizLeytte - 25 Jan 2012 |
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AffordableCareAct 8 - 25 Jan 2012 - Main.ArleneOrtizLeytte
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| | The government wants the individual mandate to be a tax, not a penalty, for two reasons.
1. Additional Congressional Authority Under Art. I, Sec. 8 | | | The detailed summary of the Act (dpc.senate.gov/healthreformbill/healthbill04.pdf) lists the payment as a penalty: "Beginning in 2014, most individuals will be required to maintain minimum essential coverage or pay a penalty of $95 in 2014, $350 in 2015, $750 in 2016 and indexed thereafter; for those under 18, the penalty will be one-half the amount for adults. Exceptions to this requirement are made for religious objectors, those who cannot afford coverage, taxpayers with incomes less than 100 percent FPL, Indian tribe members, those who receive a hardship waiver, individuals not lawfully present, incarcerated individuals, and those not covered for less than three months." Do the categories of objectors give us any indication as to whether it resembles a tax or a penalty? The fact that there are exceptions made for religious objectors indicates to me that the fee resembles a penalty more than a tax; I couldn't find many taxes out of which it was possible to opt out based on religious objection. It looks like you can do so with the social security tax if you have religious objections to being part of a social insurance system, but that doesn't seem to parallel the case here.
-- KirillLevashov - 24 Jan 2012 | |
>
> | Without coming to any conclusions just yet, I'll add some text from the Act:
*Subtitle F—Shared Responsibility for Health Care
PART I—INDIVIDUAL RESPONSIBILITY
SEC. 1501 [42 U.S.C. 18091]. REQUIREMENT TO MAINTAIN MINIMUM ESSENTIAL
COVERAGE.*
_(a) FINDINGS.—Congress makes the following findings:
(2) EFFECTS ON THE NATIONAL ECONOMY AND INTERSTATE
COMMERCE. The effects described in this paragraph are the following:
(A) The requirement regulates activity that is commercial and economic in nature: economic and financial decisions about how and when health care is paid for, and when health insurance is purchased. In the absence of the requirement, some individuals would make an economic and financial decision to forego health insurance coverage and attempt to self-insure, which increases financial risks to households and medical providers.
(I) ...By significantly increasing health insurance coverage, the requirement, together with the other provisions of this Act, will minimize this adverse selection and broaden the health insurance risk pool to include healthy individuals, which will lower health insurance premiums...
(J) Administrative costs for private health insurance, which were $90,000,000,000 in 2006, are 26 to 30 percent of premiums in the current individual and small group markets. By significantly increasing health insurance coverage and the size of purchasing pools, which will increase economies of scale, the requirement, together with the other provisions of this Act, will significantly reduce administrative
costs and lower health insurance premiums. The requirement is essential to creating effective health insurance markets that do not require underwriting and eliminate its associated administrative costs._
The Internal Revenue Code was amended to include this "requirement"/"penalty"/"tax," including all relevant penalty amounts: http://www.law.cornell.edu/uscode/html/uscode26/usc_sec_26_00005000---A000-.html
This sparks possible new discussion ingredients: Holmes' notion of a legal duty and what this would mean to the "bad man"; the "law and economics" rationalization for a Congressional mandate to insure yourself against health risks; and the expansion of the insurance market through governmental regulations of people's health choices (and wallets).
What bothers me is the use of communitarian language ("shared responsibility") as a guise for the creation of a stable marketplace ("economies of scale"). Perhaps that's why the word "penalty" was used instead of "tax": to instill the feeling of guilt in the uninsured. Breaking the tax code does not instill the sense of committing a crime against your community.
-- ArleneOrtizLeytte - 25 Jan 2012 |
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