“Does anybody really want to live in a world where the IRS has the power to impose taxes all on its own?” asks the Cato Institute’s Michael F. Cannon.
That is exactly what King v. Burwell is about. The plaintiffs in this case are not challenging Obamacare; instead, they want to uphold the act and protect tens of millions of taxpayers from illegal taxes.
Read here from Mr. Cannon how an out-of-control IRS is unlawfully taxing millions of Americans.
As Mr. Cannon suggests, “If Obamacare doesn’t work because of disputed taxes and subsidies, then Congress and the president need to fix it.”
But the law is clear. It authorizes the disputed taxes only where it authorizes premium subsidies. And it only offers subsidies “through an Exchange established by the State.” That makes the subsidies conditional on states implementing a federal program, something Congress does all the time.
The only difference here is that Obamacare is so unpopular that 38 states refused or otherwise failed to implement exchanges. The federal government did establish a fallback exchange (i.e., healthcare.gov) within those states. But, as those lower courts held, an exchange established by the federal government is not “established by the State.” Thus, the IRS is unlawfully taxing millions of Americans.
The IRS claims, risibly, that the phrase “an Exchange established by the State” is a statutory “term of art” that includes exchanges that were not established by the state. The statute says no such thing.
The IRS also argues the court should look at the entire statute, not just a few passages. But nothing in the law calls the plain meaning of “established by the State” into question. The IRS is simply trying to ignore a clear limitation on its power.
Supporters say Obamacare won’t work without those disputed taxes and subsidies. If so, that means Obamacare doesn’t work. The solution is for Congress and the president to fix it. Does anybody really want to live in a world where the IRS has the power to impose taxes all on its own?