The Supreme Court case seeking to shut down wealth taxes before they even exist
The Supreme Court case seeking to shut down wealth taxes before they even exist
A SCOTUS case aiming to protect rich people from taxes could lead to chaos for the federal government’s finances.
The plaintiffs’ arguments in Moore v. United States have little basis in law — unless you think that a list of long-ago-discarded laissez-faire decisions from the early 20th century remain good law. And a decision favoring these plaintiffs could blow a huge hole in the federal budget. While no Warren-style wealth tax is on the books, the Moore plaintiffs do challenge an existing tax that is expected to raise $340 billion over the course of a decade.
But Republicans also hold six seats on the nation’s highest Court, so there is some risk that a majority of the justices will accept the plaintiffs’ dubious legal arguments. And if they do so, they could do considerable damage to the government’s ability to fund itself.
I'm glad there's no Justices on the Supreme Court taking lavish vacations, homes, RVs, bribes, jobs and planes from wealthy people who are arguing that wealthy people should pay no tax while receiving only bailouts!
So I dug in on this and the batshit thing here is they have a strong enough case to absolutely win with the current court. "Strong" here meaning "believable enough for this court to bullshit."
The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.
That's the 16th amendment, with the relevant part bolded. The argument is that wealth is not income, and thus this falls back on Article 1 section 9 which states
No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or enumeration herein before directed to be taken.
Effectively they're claiming that wealth taxes are direct taxes (this is another shaky part, legally, and the part referenced in Moore).
Pollock v. Farmers' Loan & Trust Co. Found that a tax on income which was derived from property (rent, dividends, interest, etc.) was effectively a tax on the property, and so was a direct tax.
This was the case that set up for the passing of the 16th amendment, hence the shaky ground.
Wealth is property, holdings, capital, and money - thus by a... Let's call is "selective" view of cases like Pollock, the SCOTUS has reasonable plausibility in saying that this tax is direct, non-enumerated, and not income, and thus not protected.
It's a ridiculous decision that they could plausibly make, but they've shown they don't care if it's ridiculous, only plausible.
Edit: and of course, this was all planned.
The Trump tax bill largely gave up on taxing US companies’ foreign assets in the future — corporate money kept overseas is now generally immune from taxation, even if it is brought into the United States.
Also
When Congress passed the Tax Cuts and Jobs Act in 2017, it used a process that imposed a $1 trillion cap on how much the bill could add to the budget deficit over the next decade. So there’s a decent argument that, if Congress had known that the bill would increase the deficit by an additional $340 billion, it would have chosen not to enact any tax law at all.
Lmao at "cutting taxes raises revenue" being a thing Republicans run on
This tax would aliviate the tax evasion problem Trump has been always talking of. Why do this article then fear republicans could be against the proposal?
Before you crucify me: I know Trump is amongst the tax evaders, but at least he talks openly about the issue.
This is the best summary I could come up with:
The specific details of this very complicated change to the US tax code are not especially important — although, for reasons discussed below, they could matter a great deal if the Moore plaintiffs prevail.
These three cases arguably mark the dawn of the Lochner era, which is named for a 1905 Supreme Court decision that imposed strict limits on both the federal government and the states’ power to enact laws seeking to improve workplace conditions for workers.
The plaintiffs in Moore are represented by Andrew Grossman, an adjunct scholar at the right-libertarian Cato Institute, and David Rivkin, a Republican lawyer known for defending torture during the George W. Bush administration, and for filing one of the first lawsuits claiming that Obamacare is unconstitutional.
Macomber, a 5-4 decision mostly joined by pro-Lochner justices, said that “enrichment through increase in value of capital investment is not income in any proper meaning of the term.” That conclusion closely tracks the reasoning of Pollock, which was supposed to have been overruled by the 16th Amendment.
The Moore plaintiffs’ approach will be familiar to anyone who has studied the Lochner era, the age when the Court routinely struck down laws, not because they violated the Constitution, but because five justices deemed them “unwise, improvident, or out of harmony with a particular school of thought.”
When Congress passed the Tax Cuts and Jobs Act in 2017, it used a process that imposed a $1 trillion cap on how much the bill could add to the budget deficit over the next decade.
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