A libertarian law firm has filed a lawsuit in Indianapolis against President Biden’s student debt cancellation plan.
The Pacific Legal Foundation filed its challenge on Tuesday, reports the Associated Press. The California-based company said Biden’s plan was illegal and would only raise taxes in some cases.
The main argument against the plan is that some states will tax the amount of debt that is forgiven, which means many Americans will still have to pay for a program intended to benefit them financially. States currently considering implementing these taxes include Indiana, Arkansas, California, Minnesota, Mississippi, North Carolina and Wisconsin.
Indiana resident and attorney Frank Garrison works for the Pacific Legal Foundation and is the plaintiff in this case. Garrison is already part of a program that would allow his loans to be canceled tax-free. So Biden’s plan could hamper him financially.
Other conservative groups have opposed the idea of debt forgiveness since the plan was announced. They argued that the plan would force all Americans to pay loans, even if they didn’t go to college or personally take out loans.
This lawsuit attempts to put a stop to the plan, at least until its legality is determined. He says the plan will be a “deep and transformational policy that will have untold economic impacts”.