Changing Stance, Administration Now Defends Insurance Mandate as a Tax
By ROBERT PEAR
Published: July 16, 2010
WASHINGTON â When Congress required most Americans to obtain health insurance or pay a penalty, Democrats denied that they were creating a new tax. But in court, the Obama administration and its allies now defend the requirement as an exercise of the governmentâs âpower to lay and collect taxes.â
And that power, they say, is even more sweeping than the federal power to regulate interstate commerce.
Administration officials say the tax argument is a linchpin of their legal case in defense of the health care overhaul and its individual mandate, now being challenged in court by more than 20 states and several private organizations.
Under the legislation signed by President Obama in March, most Americans will have to maintain âminimum essential coverageâ starting in 2014. Many people will be eligible for federal subsidies to help them pay premiums.
In a brief defending the law, the Justice Department says the requirement for people to carry insurance or pay the penalty is âa valid exerciseâ of Congressâs power to impose taxes.
Congress can use its taxing power âeven for purposes that would exceed its powers under other provisionsâ of the Constitution, the department said. For more than a century, it added, the Supreme Court has held that Congress can tax activities that it could not reach by using its power to regulate commerce.
While Congress was working on the health care legislation, Mr. Obama refused to accept the argument that a mandate to buy insurance, enforced by financial penalties, was equivalent to a tax.
âFor us to say that youâve got to take a responsibility to get health insurance is absolutely not a tax increase,â the president said last September, in a spirited exchange with George Stephanopoulos on the ABC News program âThis Week.â
When Mr. Stephanopoulos said the penalty appeared to fit the dictionary definition of a tax, Mr. Obama replied, âI absolutely reject that notion.â
