Small Problem For States Challenging Health Reform: They Don’t Have Standing

lawsuit-cash-advance-fundingFile this one under two more reasons why the constitutional challenges to health care reform are frivolous. Over at Slate, Simon Lazarus and Alan Marrison argue that Virginia, Florida, and the 20 other states that have joined the lawsuits lack standing and can’t get around the Tax Injunction Act, which prohibits courts from “restraining the assessment or collection of any [federal tax]”:

The first problem is that state governments are the wrong plaintiffs to challenge the individual insurance mandate. No state will ever have to pay a penny in taxes or be told to take out health insurance: The law applies only to individuals. The attorneys general might have attempted to plug this gap by adding individual plaintiffs to their complaints. But even if they found those people, the AGs couldn’t sue on their behalf right now, because the mandate does not take effect until 2014. Between now and then, all kinds of things could cause plaintiffs to lose their standing to sue […]

There’s another barrier to the AG’s lawsuits: the Tax Injunction Act. This federal statute, on the books for more than 50 years, forbids courts from “restraining the assessment or collection of any [federal] tax” whether the suit is by the taxpayer, a state attorney general, or anybody else. The tax code gives taxpayers who believe they ought not to have to pay a tax two options: decline to pay and make their objection as a defense when the IRS comes after them, or pay the tax and sue for a refund. Congress enacted these requirements to facilitate efficient tax collection, and there is no basis for the courts to carve out an exception for these suits.

Add this to the fact that some very recent Supreme Court decisions have found that the federal government can regulate commerce and you have 22 states wasting their taxpayer’s dollars on lawsuits they can’t possibly win. But then again, they probably know that. As the authors note, “Several of the AGs, including lead plaintiff Bill McCollum, are featuring the suits in their campaigns for higher office. And, of course, the suits make for great talking points in a general campaign to discredit health care reform.”