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U.S. Constitution Title: State of New York v. Mnuchin, SDNY 18-cv-6427 (17 Jul 2018) State of New York v. Mnuchin, SDNY 18-cv-6427 (17 Jul 2018) Doc 1, COMPLAINT for Declaratory and Injunctive Relief The Issue: 1. The States of New York, Connecticut, Maryland, and New Jersey (the “Plaintiff States”) bring this action seeking declaratory and injunctive relief to invalidate the new $10,000 cap on the federal tax deduction for state and local taxes (“SALT”). What is requested (at p50): 141. Wherefore, the Plaintiff States Pray that the Court: a. Declare that the provision of the 2017 Tax Act imposing a $10,000 cap on the SALT deduction, Pub. L. No. 115-97, § 11042, is unauthorized by and contrary to the Constitution of the United States; b. Enjoin Defendants from enforcing the new cap on the SALT deduction; c. Award such additional relief as the interests of justice may require. The Argument: At pp. 1-2: A piece of legislation is not a court opinion, and it does not create a precedent which subsequent legislation is required to follow. A purpose of new legislation is to effect change. At p.2: [...] _____ What the drafters of the Sixteenth Amendment may, or may not, have understood was not ratified and made part of the Constitution. The actual language of the Sixteenth Amendment says not a mumbling word about SALT or other tax deduction. Article I, Section 8, Clause 1 of the Constitution states: Article 1, Section 9, Clause 4 of the Constitution states: The taxing power granted to Congress by the Constitution was plenary but for the underlined exceptions. Income tax was required to be proportional to be proportional to the census head count, i.e., a state with 2% of the total population would pay 2% of the total tax. This largely explains why there was no immediate attempt to implement a Federal income tax. The Sixteenth Amendment removed the requirement that an income tax be in proportion to the census head count. The power of Congress to implement an income tax is essentially plenary. The taxing power is broad enough to tax those who fail to purchase an approved health insurance claim. The Tenth Amendment states: The power to tax income is affirmatively delegated to the Congress by the Constitution, as amended. There is no restriction placed upon that power regarding apportionment, deductions for State tax, or anything else. The claim to authority under the Tenth Amendment is a sham. The first Federal unapportioned income tax was, indeed, implemented in 1861 under President Lincoln, despite the explicit constitutional requirement then in effect that such tax be in proportion to the census. The unapportioned income tax was struck down by the U.S. Supreme Court in Pollock v. Farmers' Loan & Trust Company, 157 U.S. 429 (1895), affirmed on rehearing, 158 U.S. 601 (1895). The appeal to state sovereignty is not persuasive. It was said that state sovereignty died at Appomattox. Essentially, state sovereignty did die with the Fourteenth Amendment which stood the prior relationship of the States and the Federal Government on its head, and dictated to the States who were the citizens of a State. The Fourteenth Amendment, Section 1 states, The Amendment dictated that the then recently freed slaves, and all others, who were born or naturalized in the United States, were citizens of the state wherein they resided. A hallmark of sovereignty is the self-determination by the sovereign of who is, and who is not, a citizen of the sovereignty. When a higher authority dictates who are the citizens of a State, the State no longer has a full claim to sovereignty. The Federal government does recognize the States as separate sovereigns for certain legal purposes. At p.2: Meaningless trivia. The question is whether a SALT deduction is required by the Constitution. Continuing at p.2: New York et al. can, and has, enacted whatever tax policy it chooses. The plenary constitutionally granted power of the Federal government to tax income is not subject to any requirement to grant a state and local tax deduction. The Federal government may change the allowable deductions for individuals every tax year. The people are the ultimate sovereigns in the United States, not the state governments. At p3: Whatever protecting of States' sovereign authority regarding an income was a concern for the Founders in 1789, it does not exist as part of the Constitution, as amended. The Sixteenth Amendment removed the only income tax power restriction stated in the original Constitution. Again, the delegated taxing power today is broad enough to tax those who fail to obtain a government-approved health insurance plan. At p3: These is not such hidden secret codicil embedded in the Constitution. Whatever the Founders' concerns may have been, they were jettisoned by the Sixteenth Amendment. No such concerns emanate from a penumbra of the Sixteenth Amendment. At p4: Tax legislation does not create legal precedent for future legislation. The Federal government capped individual deductions to 5 or 10 thousand dollars. The imaginary SALT deduction requirement attributed to the Sixteenth Amendment is just not there. The grant of power given to Congress by the Sixteenth Amendment contains no restrictions, and is broad enough to tax those who fail to obtain a government-approved health insurance plan.
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I do not see where the Complainant addressed the Anti-Injunction Act, 26 U.S.C. § 7421. As a technical matter, it seems it may be relevant to jurisdiction. https://law.justia.com/codes/us/2016/title-26/subtitle-f/chapter-76/subchapter-b/sec.-7421/ 26 U.S.C. § 7421 (2016) §7421. Prohibition of suits to restrain assessment or collection (a) Tax Except as provided in sections 6015(e), 6212(a) and (c), 6213(a), 6225(b), 6246(b), 6330(e)(1), 6331(i), 6672(c), 6694(c), and 7426(a) and (b)(1), 7429(b), and 7436, no suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court by any person, whether or not such person is the person against whom such tax was assessed. (b) Liability of transferee or fiduciary No suit shall be maintained in any court for the purpose of restraining the assessment or collection (pursuant to the provisions of chapter 71) of— (1) the amount of the liability, at law or in equity, of a transferee of property of a taxpayer in respect of any internal revenue tax, or (2) the amount of the liability of a fiduciary under section 3713(b) of title 31, United States Code 1 in respect of any such tax. In NFIB v. Sebelius,, 567 U.S. 519 (28 Jun 2012), Syllabus at 520, gave the Anti-Injunction Act the old Texas two-step: In the instant case, there is no doubt that it involves legislation pertaining only to the income tax. https://healthcarereform.procon.org/sourcefiles/aba-anti-injunction-act.pdf The Anti-Injunction Act Issue By Bryan Camp and Jordan Barry United States Department of Health and Human Services et al. The government and Amicus Long disagree. In Regan, the statute at issue applied to bonds issued by the state, but here the individual mandate does not apply to states, just to individuals. In Regan, South Carolina was defending its own interest in being able to issue bonds in the form it chose; here, the states are not directly affected by the individual mandate. Rather than seeking to protect their own constitutional rights under the Tenth Amendment, the states are seeking to protect the interests of their citizens. Florida v. DHHS, 11th Cir 11-11021 and 11-11067 OPINION (12aug2011) Slip Op. at 9, Footnote 6: In United States v Mellon, 262 US 447, 485-86 (4 Jun 1923) jurisdiction
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