How Congress will put its new taxing powers to good Democratic use.
How would you like our federal government to tell you to install new energy-efficient windows or make your next new car a Volt?
The Obamacare opinion gives Congress a roadmap to do precisely that. As most of us know, Chief Justice Roberts wrote an opinion that the four liberal Justices joined in which he held that the Obamacare mandate was a constitutional exercise of Congress's tax powers. Not that the mandate, and its penalty for non-compliance, are taxes like other taxes within the meaning of the Anti-Injunction Act, which we would have to pay then sue to recover, mind you, but "taxes" of some other kind.
Chief Justice Roberts said that the penalty was a tax because it (1) wasn't more than the cost of insurance, and, in many cases, would be less; (2) didn't require an intent or state of mind; and (3) even though collected by the IRS, couldn't be enforced by criminal prosecution or other means "suggestive of a punitive sanction." This suggests that a $50 penalty, collectible by the IRS, for failing to install energy-efficient windows would find 5 votes for its constitutionality in the Supreme Court.
Significantly, it was Chief Justice Roberts who tossed that $50 figure out. What if the penalty were greater, say the cost of installing an energy-efficient window on each window in your house or structure? What about a penalty of the difference between the price of the electric car you didn't buy and the price of the car you did? We don't know.
Chief Justice Roberts tells us not to get too excited. The new power has limits, even though the Court hasn't looked closely at "the regulatory motive or effect of revenue-raising measures" lately. Nonetheless, as he says, "We do not suggest that any exaction lacking a scienter requirement and enforced by the IRS is within the taxing power." Whew! That's sure a bullet dodged!
We'll just have to wait for the next time Congress uses this power and a challenge winds its way to the Supreme Court to see how far Congress can go. All we know is that some "exaction[s] lacking a scienter requirement and enforced by the IRS" will be OK, and others won't.