Tuesday, July 9, 2019
Jonathan H. Choi (NYU), The Substantive Canons of Tax Law, 72 Stan. L. Rev. ___ (2019):
Anti-abuse doctrines in tax law have traditionally been formulated as multi-factor tests that weigh the facts of the taxpayer’s case but ignore the tax statute at issue. This approach has proven problematic: some judges import statutory considerations regardless, creating inconsistency and confusion, and some scholars criticize the doctrines as antitextual violations of the separation of powers.
This Article argues that anti-abuse doctrines should be considered substantive canons of construction, interpretive presumptions that can be rebutted by statutory text or purpose. This resolves apparent arbitrariness in the doctrines’ application as simply the rebuttal of presumptions and reconciles them to textualists as constitutionally permissible background norms. It also provides a framework to test the validity of disputed doctrines and allows them to be more flexible and intuitive.
Although many scholars have studied substantive canons and anti-abuse doctrines separately, little writing so far has connected the two. This Article does so, and also provides a catalog of substantive tax canons based on a primary review of cases, serving as a resource for future academics, practitioners, and judges.