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Court: Obamacare's $473 billion in taxes not 'revenue'

Judges on the District of Columbia Circuit Court of Appeals ruled on Friday that the $473 billion in taxes embedded in Obamacare are not revenue, so it will not rehear a case that challenges the constitutionality of the healthcare law because the Constitution requires revenue measures to begin in the U.S. House.

But the opinion noted a deep division among the judges, with a minority scoffing that to argue such a pile of money is not revenue “is untenable.” The minority, instead, would have granted a rehearing, and then upheld Obamacare because the judges said a trick used by Sen. Harry Reid allows the plan to meet constitutional requirements.

The complicated case has been around for several years already, and likely isn’t going away soon, with announced plans by the Pacific Legal Foundation to take the fight to the U.S. Supreme Court, where Obamacare has become, more or less, a permanent tenant.

Already three fights have been decided there. In the first, the court said the revenue is tax income, not fees, as Obama proposed, so that it complies with the Commerce Clause. In the second fight, the court said federal bureaucrats could not force company owners to violate their faith and pay for abortifacients. In the third, just weeks ago, the court ruled that insurance exchanges “established by the state” actually meant established by the state or the federal government because they did the same thing.

The current case was brought by the PLF on behalf of businessman Matt Sissel, and argues that because the Supreme Court redefined the fees in the law’s original version as taxes, that subjected it to the Origination Clause of the Constitution, which requires revenue-raising bills to start in the U.S. House.

However, Reid’s trick was to take a bill the House already had approved, replace the entire bill with his Obamacare language, and then pass it, meaning that the actual text originated in the Senate.

Your roadmap for surviving the nationalization of health-care decision-making is here, in “Suriving the Medical Meltdown: Your Guide to Living Through the Disaster of Obamacare.”

The only thing that originated in the House apparently was the bill number.

The majority of the D.C. Circuit judges, on the request for rehearing from PLF, said the $473 billion in revenue from the bill really isn’t revenue. And they ruled that the “Senate may amend House-originated revenue bills without limit.”

“The purpose of the ACA was to overhaul the national healthcare system, not to raise revenue,” the majority wrote. “”The centerpiece … is a requirement that individuals purchase insurance, supported in part by the tax subsidies where needed. A mandate that people lacking insurance pay to the government a ‘shared responsibility payment’ is designed to encourage individuals to buy coverage.”

But the minority said there is “a serious constitutional question about the 2010 Affordable Care Act.”

“Did Congress’ enactment of the act comport with the Origination Clause of the Constitution? … If the Affordable Care Act did not meet the requirements of the Origination Clause, then the Act – or at least revenue-raising provisions such as the individual mandate – must be invalidated.”

They concluded that that the idea that Obamacare “was not a revenue-raising bill …. is untenable.”

“So as not to increase the annual budget deficit and the overall national debt, the Act imposed numerous taxes to raise revenue. Lots of revenue. $473 billion in revenue over 10 years. It is difficult to say with a straight face that a bill raising $473 billion in revenue is not a ‘bill for raising revenue.'”

But the minority then found the bill did start in the House, since Reid used a House bill number, slapped in the wording of Obamacare, and then voted on it.

The minority said they would have reviewed the case because as it is, it sets a bad precedent, because it allows the “pretty extreme position” that anything raising taxes for a “specific purpose” does not have to originate in the House.

Ultimately, the minority wrote, it will “degrade the House of Representative’s constitutional prerogative to originate revenue-raising bills.”

PLF spokesman Timothy Sandefur said, “Now that the entire D.C. Circuit has decided not to reconsider, our next step is to ask the Supreme Court to take the case.”

“We argue that if the individual mandate is a tax, as the Supreme Court said it was in NFIB v. Sebelius, then it’s still unconstitutional, because it originated in the Senate and not in the House, as the Constitution requires.”

He said, “We knew going in that this case would ultimately end up on the Supreme Court’s doorstep, and now it’s time. … For now, the importance of this case was emphasized in Judge Kavanaugh’s opinion urging his colleagues to reconsider. The opinion, he said, ‘incorrectly read[s] the Supreme Court precedents on the Origination Clause,’ and ‘blows [one] narrow exception up into a giant new exemption from the Origination Clause, even for obviously revenue-raising bills such as the Affordable Care Act, which raises $473 billion in revenue.'”

Your roadmap for surviving the nationalization of health-care decision-making is here, in “Suriving the Medical Meltdown: Your Guide to Living Through the Disaster of Obamacare.”

The case was filed on behalf of Sissel, a small-business owner who wants to pay medical expenses on his own and has financial, philosophical and constitutional objections to being ordered to purchase a health plan he does not need or want.

See Sissel’s comments:

Dozens of House members have filed a brief in the case explaining the ban on tax measures starting the Senate was with reason.

“The primary dividing issue between the delegates to the Constitutional Convention of 1787 was the question of how to resolve the method of representation in the upper chamber. The small states preferred to retain the equal representation they had enjoyed under the Articles of Confederation, while the large states wanted to shift the national legislature to a proportional representation of the American population. No disagreement threatened the success of the convention and the new Constitution more than this one. After a month of heated debate and threats of secession, the delegates finally agreed to the Great Compromise of 1787; a bicameral legislature with equal representation of states in the upper branch, and proportional representation of the nation in the lower branch. That Great Compromise was only made possible by agreement of both sides to restrict the upper branch from originating money bills,” their brief explained.

At least two other challenges to Obamacare still are looming. One alleges it violates the Fourth, Fifth and Ninth amendment provisions on privacy, and another says Obama arbitrarily has made changes to the law – outside of Congress.