On the first day of oral arguments in the case challenging President Obama's national health care law, justices seemed skeptical that the individual mandate should be considered a tax -- one of the main consitutional defenses being offered for the law.
To be clear, today's 90 minutes of oral arguments did not concern the underlying merits of the case, but whether an 1876 law called the Anti-Injunction Act bars the Court from ruling on the suit at this time. Under the Anti-Injunction Act, people cannot challenge a tax in court until after they have paid it. This would effectively punt the issue until at least 2015.
However, there is some overlap between this question and the idea of whether the mandate is a tax, and justices on both sides of the ideological fence expressed skepticism that the mandate should be treated as a tax.
"This is not a revenue-raising measure, because, if it's successful, they won't -- nobody will pay the penalty and there will be no revenue to raise," said Justice Ruth Bader Ginsburg of the mandate.
Another liberal on the court, Justice Stephen Breyer, said of Congress's description of the fine for non-compliance with the mandate, "They called it a penalty and not a tax for a reason."
Because both the Obama administration and the 26 states challenging the law along with the National Federation of Independent Business agree that the Anti-Injunction Act does not apply in this case, the court appointed attorney Robert Long to argue that it does apply. The Fourth Circuit of Appeals was the only court to reach this conclusion so far. Long argued that the Anti-Injunction Act applied here, because the fine for non-compliance is "assessed and collected" like a tax.
The Obama administration has to thread a difficult needle. U.S. Solicitor General Donald Verrilli argued today that the penalty for non-compliance with the mandate did not function as a tax for the purposes of the Anti-Injunction Act. Tomorrow, he'll have to argue that it does operate as a tax, and thus is a constitutional exercise of the congressional power to levy taxes.
Justice Samuel Alito asked Verrilli whether he could point to another case in which courts identified something as not a tax for the purposes of the Anti-Injunction Act while still ruling it was a constitutional exercise of taxing power. Verrilli could not name any. But he went on to explain that the government had identified a number of penalties that would fall into the same category, including three that concern alcohol and tobacco.
Attorney Greg Katsas, representing the NFIB and the states, argued that the Anti-Injunction Act shouldn't apply because the root of the challenge is to the requirement to purchase health insurance, not to the penalty for non-compliance.
But Chief Justice John Roberts was skeptical that the two elements (the mandate and the penalty) could be separated, who said, "Why would you have a requirement that is completely toothless?" he asked.
UPDATE: The Supreme Court has now posted full audio and transcript of this morning's oral arguments, which you can find here.
UPDATE 2: NFIB lawyer and Georgetown law professor Randy Barnett, one of the early architects of challenges to Obamacare, also had a similar observation of the justices on the taxing power issue: "Most of the justices seem skeptical of the claim that the mandate and penalty are a tax. They seem ready, willing, and able to reach the merit of the commerce clause claim.”