The Proposed Tax on Billionaires’ Income Is Most Assuredly Constitutional, Unless the Supreme Court Simply Makes Stuff Up

The Proposed Tax on Billionaires’ Income Is Most Assuredly Constitutional, Unless the Supreme Court Simply Makes Stuff Up

It sometimes seems that every policy disagreement is immediately turned into a constitutional question. People who lose elections and then face the consequences—the passage of laws that they do not like—are all too tempted to scream: “You can’t do that. It violates my constitutional rights!” Many times, that is true; but most times, it is just a desperate plea from people who lost at the ballot box. The latest version of this argument comes from American conservatives who are shocked to learn that one of the biggest tax advantages enjoyed by rich people—the nontaxation of huge amounts of capital gains income —might be partially pared back under a new proposal from the Democrats. Republicans’ response was not merely, “We think that’s bad policy, and here’s why,” but “That’s unconstitutional…we hope.” The problem for Republicans is that there is no theory available under which Democrats’ tax proposal would fail to pass constitutional muster. The word “income” is in italics in the previous paragraph for a reason, which is that the relevant constitutional provision (the Sixteenth Amendment ) allows the federal government to tax “all incomes, from whatever source derived.” All incomes, not merely certain types of income. That, however, does not stop the immediate chatter from being all about a constitutional challenge from Republicans. The problem, again, is that there is no legal hook for such a challenge, and the closest thing to a precedent on which they could rely has been repudiated both by the Supreme Court and by […]

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