President Joe Biden’s ambitious legislative agenda has encountered a formidable obstacle: the United States Supreme Court. In a surprising turn, the highest court’s recent actions indicate potential setbacks for Biden’s efforts to steer the nation towards progressive policies.
According to a report by Conservative Brief on Wednesday, December 27, the Supreme Court’s stance suggests a looming challenge to thwart Biden’s initiatives, particularly his push to enact measures leaning the country further leftward.
A critical battleground in this struggle is Biden’s proposal to levy taxes on the affluent, a pivotal component of his economic strategy. This proposal faces jeopardy following the Supreme Court’s earlier ruling that deemed Biden’s $430 billion-plus plan for student loan forgiveness unconstitutional.
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This decision sets a precedent that could cast a shadow over the administration’s future taxation endeavors.
A significant case that could substantially impact Biden’s taxation objectives is Moore v. United States. Scheduled for a fall hearing, this case revolves around the constitutionality of implementing a wealth tax—a concept frequently advocated by Biden.
At the heart of the case, as outlined by the SCOTUS Blog, lies the question of whether the 16th Amendment empowers Congress to tax unrealized sums without apportionment among the states.
Biden’s proposal entails a 25% annual tax on wealth gains exceeding $100 million, encompassing unrealized capital gains currently untaxed. Despite assurances from the White House that the tax would only impact the top 0.01% of the highest earners, the proposal faces formidable challenges, particularly given the Republican control of the House of Representatives.
A Supreme Court ruling deeming such a tax unconstitutional could effectively derail this ambitious taxation plan.
The Moore case, though not revolving around substantial monetary sums, delves deeply into critical issues of taxation and the definition of ‘income.’
The case involves Charles and Kathleen Moore, a Washington state-based couple, who invested $40,000 in an Indian company in 2005. Despite the company’s yearly profits, they never received returns or payments.
Several influential groups, including the libertarian CATO Institute, have filed amicus briefs in support of the case. The CATO Institute argues that Biden’s proposed action would violate the Constitution, challenging the longstanding interpretation of ‘income’ since the ratification of the Sixteenth Amendment.
Another prominent organization, the U.S. Chamber of Commerce, has echoed concerns about the potential redefinition of ‘income.’ In its amicus brief, the Chamber highlighted the risks of subjecting businesses and shareholders to taxes on anything later deemed ‘income,’ which could create profound uncertainty in an area of law that demands clarity.
Furthermore, the Supreme Court is set to address cases this fall that signal potential efforts to curtail the federal administrative state. These cases, questioning agency funding’s constitutionality, federal courts’ deference to agency interpretations, and the potential reinstatement of jury trials in administrative civil cases, signal a broader challenge to the administrative status quo.
As the Supreme Court gears up for a consequential term, President Biden finds himself navigating a complex legal landscape, with intense scrutiny on his taxation plans and the broader administrative state.
