Reply #52: The ACLU doesn't believe mandatory health insurance is a tax.

[MilesColtrane]

In a statement about why they haven't challenged the State of Massachusetts' mandatory health insurance law, they say:

http://www.aclum.org/health/pdf/aclum_individual_mandates_statement.pdf

Only the Legislature has the authority to tax Massachusetts residents, and some people have suggested that requiring individuals to purchase health insurance - presumably from private third party insurance companies that set and collect premiums - constitutes an impermissible delegation of the Legislature's constitutional taxing authority to insurers.

However the individual mandate does not exhibit a key feature of a tax.

The failure to pay a tax both carries a penalty (such as a fine) and also requires the taxpayer to pay the underlying tax owed. In contrast, the mandate statute only imposes a fine if an individual decides not to purchase insurance; it does not require an individual to purchase insurance after having paid this penalty. Because of this distinction, a court would be unlikely to view the individual mandate as a "tax".

There are some very sharp lawyers working in the ACLU. I tend to believe their assessment in this matter.