Sam Alito’s Lonely Fight to Defend His Friend’s Harebrained Anti-Tax Scheme

This is part of Opening Arguments, Slate’s coverage of the start of the latest Supreme Court term. They asserted that the 2017 law taxes “unrealized income,” or assets that haven’t yet been cashed out, and that this feature made it an unconstitutional “direct” tax. But the lawyers’ ultimate goal, as they’ve admitted, is to secure a decision against this tax to prevent a future Congress from enacting a true Warren-style “wealth tax.” Related From Slate The Supreme Court’s Utter Disregard for Science Is Somehow About to Get Worse Crucially, the Grossman/Rivkin theory would recklessly imperil countless other taxes that raise trillions of dollars for the government. Kavanaugh raised this point with Prelogar, who embraced it as a way of avoiding more difficult “foundational questions about the meaning of the 16th Amendment.” You could hear the compromise taking shape: The court says this tax is constitutional because it targets realized income, without answering the bigger question of whether a true wealth tax complies with the 16th Amendment. “I understand you want to talk about this case, and ultimately we have to talk about this case, but I just want to understand how far your argument goes, how far does it logically go.” Alito then inquired whether Congress could tax a billionaire’s lifetime worth of profits, going back to when he started up “a little business in his garage.” It fell to Kavanaugh, of all people, to save Prelogar: “On the proverbial open door for Congress,” the justice said, “members of Congress want to get reelected.” So Alito’s “farfetched” hypotheticals probably won’t come to pass.