Even Obamacare Website Calls the Tax Penalty a ‘Fine’ and a ‘Fee’

On June 28, 2012, Chief Justice John Roberts announced his vote to uphold the Affordable Care Act’s (ACA) individual mandate provision, siding with the Supreme Court’s (SCOTUS) liberal cohort to obtain a 5–4 vote in favor of the Obama administration in the now-infamous case National Federation of Independent Business v. Sebelius.

It was a move against the pro-liberty movement that would make even Benedict Arnold say, “Wow, now that’s betrayal.”

The only thing more puzzling than the decision itself was the legal justification Roberts offered in his opinion.  According to Roberts, the reason the individual mandate is permissible is because the federal government has the authority to tax and the so-called Obamacare “fine” is actually a tax.

Virtually no legal scholars, academics, or political pundits predicted SCOTUS would come to this conclusion, and critics of the decision quickly pointed out that the ruling effectively gives the federal government the authority to force Americans to engage in or refrain from any activities the government sees fit as long as the failure to comply results in a “tax,” as opposed to a “fine,” “fee,” or some other form of punishment.

It did not matter that the lawyers representing the federal government never made this claim themselves or that the Obama administration had consistently referred to the so-called “tax” as a “fine” on numerous occasions.  It was perhaps the most bizarre rationale for an expansion of government power ever conceived by a Supreme Court justice writing an influential opinion, and the damage from the decision has not yet been fully realized.

One would think that in the aftermath of the decision, the Obama administration would stop referring to the resulting “tax” for failing to comply with the ACA individual mandate as a “penalty,” since the Supreme Court never ruled it would be permissible to punish an American for choosing not to purchase health care.  The White House chose a different route, choosing instead, as early as the next day, to call the “tax” a “penalty.”

“It’s a penalty because you have a choice. You don’t have a choice to pay your taxes, right?” said then-White House Press Secretary Jay Carney.

Since then, President Barack Obama’s administration has referred to the “tax” as a “tax” on multiple occasions, but it often simply goes with the term “penalty.”  Amazingly, the HealthCare.gov website has never referred to the fine as a “tax,” which ought to confuse and anger every American in the country.

On a page titled “Exemptions from the fee for not having health coverage,” the website reads, “Most people must have qualifying health coverage or pay a fee (also known as the ‘penalty,’ ‘fine,’ ‘individual shared responsibility payment,’ or ‘individual mandate’).  But if you qualify for a health coverage exemption you don’t have to pay the fee.”

Nearly three years after Roberts justified the individual mandate by insisting the Obamacare fine is actually a “tax,” no one, including those people who have benefited most from the decision, even bother to call the penalty a “tax.”  In fact, as far as I can tell, Roberts is the only person in the United States who actually holds that view, which is a claim that on its own tells the entire absurd story.

Justin Haskins (Jhaskins@heartland.org) is an author, blogger, and the editor of The Heartland Institute, a leading free-market think tank headquartered in Chicago, IL.