When is a penalty considered a tax?

Richard McCord, Henderson

Friday, July 6, 2012 | 2:01 a.m.

Chief Justice John Roberts, knowingly or unknowingly, has put the Democrats in a political bind. His simplest course was to rule in accordance with his written opinion that the “individual mandate” in the Affordable Care Act is unjustifiable under the Constitution’s commerce clause. But he was apparently listening when the Obama administration argued that if the mandate couldn’t pass muster under the commerce clause, then it was really just a tax. (Even though before passage of the law, the administration adamantly denied that it was a tax. The whole act was merely a budget reconciliation measure, too.)

Reasonable debate could be had about whether a penalty is a tax. If you don’t pay your income taxes, you are charged a penalty. Is that a tax, too? Are taxes levied for non-compliance? Can private third parties receive and retain taxes or is that role only for the government? If a payment to a private third party is made under compulsion of a penalty charged by the government, which is the tax: the payment or the penalty? Or are they both?

That debate is for another day. For now, the mandate is a tax because the chief justice of the U.S. Supreme Court declared it to be so. The political bind for the Democrats is they promised not to raise taxes on the “middle class,” but now they’ve done just that. They are trapped by their own tortured, whatever-it-takes arguments. By the way, budget reconciliation measures in the Senate need only 51 votes to repeal, too.