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Tuesday, March 21, 2017

Whose money is it, anyway?

A manager's amendment to AHCA was submitted on Monday, containing several changes designed to get conservative and Freedom Caucus members on board. Under the new legislation, people will not be able to roll unused tax credits into health savings accounts. This change was made as a sop to anti-choice activists, who argued (as far as I can tell) that allowing tax credits to be placed in individual's HSAs would be for government funds to, potentially, be used for abortions. This is on top of a provision that prohibits tax credits from being used to purchase insurance plans that cover abortion.

But in Arizona Christian School Tuition Org. v. Winn, the Court rejected Establishment Clause taxpayer standing in a challenge to a state scheme of giving tax credits to individuals in the precise amount of their contributions to organizations that gave scholarships to students attending religious private schools. The linchpin of the Court's analysis was that the tax credit was not an expenditure of government funds, because the money never passed into government hands--it was money that the government never collected because it lowered that individual's tax bill (for whatever reason). There was no Flast standing to challenge what amounted to charitable expenditures by private individuals.

But doesn't it follow that these restrictions on the use of tax credits are imposing restrictions on the use of private funds (in a way that arguably constitutes an undue burden). The government is lowering the tax bill for individuals, but then limiting how that individual can spend their own money.

What am I missing?

Posted by Howard Wasserman on March 21, 2017 at 10:57 AM in Howard Wasserman, Law and Politics | Permalink

Comments

To the extent the credits are advanceable and refundable, the money passes through government hands.

Posted by: Mark Regan | Mar 21, 2017 11:14:53 AM

I think you suggest a good point if we apply the principles to both sides, but it not being enough on a constitutional level is different from it being enough for a policy decision.

Posted by: Joe | Mar 21, 2017 11:39:20 AM

These are UNUSED credits, in other words, money from the government to individuals over and above their tax liabilities.

But more importantly, Joe is right.

Posted by: biff | Mar 21, 2017 7:15:47 PM

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