no path to citizenship for them so that is ambiguous about it in its application to those workers and for the reasons that have been argued both in the briefs and here again this morning we believe that the covenant should be construed as not extending to these  nonresident non citizen workers and i think that's the only way that you can rationalize the whole thing including in particular section thirteen zero one which goes to one specifies for certain benefits provisions which appl think it's as if it's expresses an understanding we believe of what congress how congress viewed the covenant and if the covenant applied across the board and resolved all the benefits questions as the c m i just by looking simply to w the six zero six b refers both taxes and benefits and then you look at thirteen zero one and it's it's true it's addressing benefits as though if it wasn't resolved by six zero sixty that's that's the point and i haven't heard the government therefore then the the main argument that we made in our brief which is if we accept the government's position that you have to look as at how they apply in guam then the question is how do they apply in guam what is the situation in gong when they go ahead i would most like to hear about the excise tax that seems to me to be the one point on which the closest issue ok let me let me move to that and i would like to come back to the to our separate argument on six zero six b because i think it's hasn't been adequately answered by the government on the excise tax to me this is a plain language question  covenants specifically refers to excise and self employment taxes and that's in contrast to to an earlier draft which had a very specific provision if using which had a more general provision that said referred to those laws of the united states which imposed taxes to support it used and that frankly is the way the government's lawyer has referred to it this morning she kept saying it imposes the taxes it imposes social security taxes and that's what an earlier draft of the covenant provided the draft that was actually agreed to and adopted replace that more general statement with a more specific that impose self employment and x using excise and self employment taxes and those two provisions tracked very closely to the statutes with one important exception the statutes impose on those who are self employed a tax on quote self employment income that section fourteen zero one and on employers they impose a quote excise tax that section thirty one eleven and on employees they impose a tax on the income quote income of every individual that section thirty one zero one so in the statutes we see three distinct descriptions excise self employment and income but then when we come to the covenant there's only two  they were excluded entirely and i'm sorry i don't know the answer the question is with respect to the citizens of the mariana islands so so when you matt when you match up the the covenant language again is amended from an earlier more general version against the statutes and you see that they specifically referred to two but not to the third i think the conclusion is that they meant to cover only the two and not the third now the government's response to this and is ankara's response to this is that while excise is a broad term that could be construed as covering all three even if that were true i don't think it would be relevant where we're dealing with specific terms that are used in a specific context here but but even more generally the black's law dictionary definition to which the government cites into its design court cites was from an addition that was issued after the government was entered into and when you look at the one nine hundred sixty eight fourth edition it used a much more narrow definition of excise tax that would cover here why not well again it's six zero six zero one a and c are dealing generally with income taxes this deal specifically with taxes to support  so security program specifically with excise and self employment taxes which you're saying doesn't include well i think x is on the employees which are income taxes it's dealing specifically with the subject matter of taxes  support you now switching from one here to another as it as it benefits you but your main your argument as to the limitation as to why the employee taxes aren't covered just because this is only about excise and self employment provision of six zero one which deals with income taxes generally and i think it's worth noting your honor that the government's brief describes all of the taxes that support social security as employment taxes so under the government's view of it the word income taxes is used in six zero one wouldn't apply ok to the right on this one i think they're right your honor and i think they're out for the reason i just described a minute ago that the subject matter six  six is the one that governs now the government says well this would be crazy to say that these nonresident workers art don't have to pay the employment line only being the nonresident workers that's why your argument so ok that any workers would have to pay them is i mean to my mind really not a bad argument but except that it's result would be that nobody in and c n n nine pays  so you might ask well why would it why would they do that you know and i think that their historical record is replete with record a recognition of the burdensome nature of bringing the cname i into the federal system and in particular with respect to the burdensome nature of the fica taxes i mean if a tax break tax breaks that's i mean read the newspapers about all of the complaints about the irrationality of tax  breaks this is a tax break given to wage earners in a country where the whole point of entering into the seeking a political union with united states and entering into this covenant was to find ways to develop the local economy and i it makes sense to me that in that context just well and that context where the concern that animated this whole thing was a stagnant economy that needed its encourage workers in particular this is kind of a different take on i mean i'm six or six pieces says the united states which imposes excise and self employment taxes so that's a clear reference to fica right because fica imposes excise taxes it's a clear reference to section thirty one eleven which is the tax on employers that it doesn't say limitation after that in the language of six and six b but it imposes an excise tax on employers and on employees i could write that doesn't that said this definition because it doesn't say the united states which which only imposes excise taxes it says which impose excise and self employment so if it is such a law that would apply in this situation because it does in buzz and is actually fica actually does with respect to employees it still is one of those laws in the united states which imposes excise taxes it poses an excise tax on employe reading the playing language of the statute my reading of it is when you when you have you know three taxes in the fica statutes and only two of them are referred to in the covenant that that's an exclusion of the third th bolster employer and employee taxes i think if the court looks at those cases they're not addressing this issue they're just simply citing the same statutes that were citing here and i think in this context where we're trying to figure out what the covenant means when it uses the precise prize i think that with your honor render superfluous the word and self employment taxes by because if the reference to those laws which employees impose excise taxes was enough to incorporate all of the various taxes imposed it self employment is not an excise tax under the government's view it would be and i think that sure that well i don't know that they would concede a bit certainly or honor the the the  as they apply in guam language that even if the government's view of the bap is the governing standard even under that view we have to look at hat how do they apply in guam another government is recognized that the g yes exactly and what they recognize is that even though h two visas are not available in the c n n my the counterpart to that is a worker permit under the nonresident workers act and so the government is recognise that in applying the language as they apply in guam we have to take account of the differences between the two countries it can't be completely mechanical but where but they try to draw the line and say but it's still limited to filipino workers and we think that that's still infringing on the purpose of this covenant which is to give effect in c n n my taking account of its own economic and legal circumstances including that it was not governed by u s immigration law taking into account all of those differences then you give effect to this and so what was going on in guam is that the filipino workers made up essentially all of the nonresident temporary contract workers and so in guam workers who come to guam on a temporary contract basis as nonresidents no path to citizenship are not subject to taxation and the time that was adopted the recognition was that it would not be fair to subject them to taxation when they're not not likely ever to qualify for benefits and our position is that same principle applies in the c n n mayank and cannot be limited simply to the filipino workers in guam it was essentially the entire alien workforce and that same principle should govern in a c m at c n a my particularly when you recognize that it had its own immigration authority and it was entitled to choose exercising that immigration authority which countries it would accept nonresident workers from and i think the relevant policy considerations again support that when you look at the history of the covenant it was to spur economic development and it was to there was a lot of concern about mitigating the tax burdens  and phasing things in and in contrast all of that under the government's position you have this extraordinary new obligation that doesn't apply in guam that nonresident workers give effect your full effect for that and including to the workers here at issue and i'll reserve the remainder of my time for them all right thank you c thank you your owners i am seeking that i should first address the excise tax issue and whether employees in the northern mariana islands are subject to fica tax evasion i guess i would start with the very broad conclusion that to have exempted every single employee in the mariana islands from drafting history here is that there was a provision that would have done exactly what you say and then her some reason which no one seems to know it was made more specific and state of saying those laws of the united states which impose taxes to support which provide benefits they put in impose excise and self employment taxes no and i should think these people were just any ads in or are exercising their mouth for no reason why would they do that if they didn't mean something your honor i can only speculate because there's no explanation of why that change occurred i can only speculate that the thinking was it made it more specific to address both self employment taxes which are income taxes and under the income tax provisions and then we would submit and are also in contempt of parliament employed taxes or even more clearly income taxes suggested is maybe at that point we bump back to the income to the tax provision six one but how you can say that the excise tax covers the income part or the employed tax i have a real problem with t speaks in terms of income from wages from employment so it is it's a subset of the income and it is it's an employment tax the tax and put the post on the  employee portion of the fica tax and so that that's why they have fannies that crowd there are two reasons why and the two cases have slightly different postures in concorde case individual employees are plaintiffs and so there's not doesn't seem to be an issue there the issue is more with the american pacific case because the employees are not  they are not parties we yes these employers have paid they withheld from their employees wages and paid over to the government the employee portion of fica i mean that's that's the way the fica system works for employees it's withheld it's paid over then the employer pays its separate portion of the fica taxes and together those are social security or employment taxes and they come under the rubric of employment taxes and subtitle subtitle c so there are different animal from the income taxes which we pay on ten forty these are paid for workers they're generally paid automatically by the withholdings from wages so one part of the standing aspect is have you actually paid this money over both for yourself as an employer and then on behalf of your employees and the second part of the standing inquiry was have the certifications been have those employees consented to the employer undertaking this suit on the certain employers who have not submitted the certification so we would submit that with respect to them if the court were to think otherwise and take a different view than the district court then that matter would need to be sorted out  further for the proceedings but we're certainly hoping that the court takes the same view that the federal circuit took of the interpretive issue with the term excise taxes john court went through a very careful and i think thoughtful analysis first looking at the statutory structure of employment taxes they are i mean it this is sort of maybe in the use point or anyway it's they are in the employment tax sections and then the tax in so far as that's a tax on income of employees it's only income with respect to region is from employment at that point the  and not the third one i mean it's it's just very difficult to explain why it would have been written that way if they meant to encompass all three i think they were i best i can say your honor is that they were speaking broadly they were speaking in truth it was a broad didn't have to do it at all i mean they hadn't done it at all in fact and then they went that's made it more specific well i think that earlier version did not specify the self employment taxes i think what they were trying to to to get out  they didn't have to because had those laws that support the social security system is no reason to there is no particular explanation for why they put that in and that goes to my point that t exempt all employees from the laws that impose taxes to support the social security system to silently exempt all the employees in the mariana before and so that would be a reason that we really want to leave it out because this is so much money that we don't want to make the employees pay their part i think your honor that actually so i mean with the extraordinary but it is an explanation well no your honor i think i respectfully i disagree i think you've actually made my point for me that congress was anticipating the grafters of the covenant and congress were anticipating that all these workers were going to have to pay social security taxes during that and it would be somebody was going to have to pay a lot more than they were paying and and that the the companies and the self employed people and maybe they just as in the you know they're the poorest of this group by either but i mean do i think so i you know you do what some more evidence of it but it's not as if there is a story which would fit there is your honor but i think that concerns about the burden it was just and the reason why it was phased in gradually support the idea that it was going to be applied the way it is applied in the united states i mean in the united states employees no matter what their personal situation from poor to wealthy pay if they're if they're earning wages they pay employment taxes they pay their the amount is withheld from their wages and then it is paid over to support the fica system why the mariana islands would be excepted from those laws of the united states would be really quite astonishing without more discussion of  i just when reading this i don't think they would have i mean i don't want to speculate it's not there because they do talk about laws of the united states is very broad and supporting the united states social security system those those are both two very broad concepts and they embrace the idea of employee and employer portion of it i i would submit that excise its size tax is the employee has a great faith segment of income a lot more may be taken but then they have a right to get back over payments whenever it's paid into fica the individual employee never has a right to get it back from the employer or the government if i think correctly calculate that's correct your honor it's not it doesn't operate the same way as the ten forty income tax system where if you think you've overpaid because you have more deductions or what have you and you file your return and ask for a refund employment taxes are turned over by your employer now obviously in this situation the employers are seeking refunds but because  and they can in circumstances where they say they are overpaid and their employees agree that they never had to pay in first place yes yes that would be correct i would also i would also well i would say to to go through the paces your honor the we would say the statutory structure really supports this because the taxes are in the employment tax section which is not income tax the statutory language excise tax is not a term that's defined in the code and so when you look outside the code for a definition certainly the definitions are broad enough to encompass a tax on the engagement of an occupation which would sit with the employee portion counsel refer to the various editions of black law dictionary and suggested that the additions when the drafters were working on this were different dictionary definitions at the time that are precisely what we are suggesting here we also submit that the legislative history of the covenant overwhelmingly supports our view because they were it refers very quite broadly to the laws of the united states which impose taxes to support the united states social security system with no distinction whatsoever and no between employer and employee portions and no reservation with respect to the point portions in particular this section by section analysis which is the statement of the drafters of the the covenant refers again broadly to the laws of the united states which impose taxes to support the social security system there is nothing whatsoever in any of the legislative history either that section by section analysis the house report the senate report the interim reports from the individuals working on implementing the covenant contains any suggestion whatsoever that the laws of that is support the social security system are limited to the employer portion of social security and so to the extent that this segment of the covenant is ambiguous and raises this question it's entirely appropriate to look to that legislative history to see what the drafters were were thinking of and what congress was thinking of when it enact this and i think it would have been a huge thing for congress to pass a law that exempted all employees without making  detail it seems to use excise the term excise for both the employee and employer portion and there's another case from the fifth circuit that we've we've cited that the system funds excise taxes separate from the income from income taxes so i guess inclusion is sort of the commonsense reading that would have avoided and observed result the commonwealth of the northern mariana islands is part of the united states in the laws of the social security system applied of the commonwealth and they apply as they do  in other areas of the united states council also refer to the exception for workers from the philippines that applies to guam and i as i understand their argument it's kind of a policy argument that well our chinese national workers who were temporarily working in the northern marianas were there similar to the philippine work i suppose there are who are sort of a level of generality argument i aren't subject to h two pieces but just similar fees so that our similar immigration situation and they're saying that well if you're going to do that and then they agree that you should do that then you can go up one level of generality so to speak and apply it to not filipinos in similar situations so where's the line  your honor what they're referring to is a kind of a brief amnesty period it's not an overall exemption of employers and overall relief provision with respect to the h visas now the immigration laws apply in the northern marianas as they apply elsewhere in the united states but the the iris did permit kind of a and a little relief provision for those employers who were confused about whether they were obliged to pay fica taxes with respect to workers who had the commonwealth equivalent of the h status and but that amnesty if you will ended as of january first two thousand and fifteen so to use that as kind of a springboard for saying well gosh we should exams any kind of work under the spring for is my understanding is they're saying that that that methodology i e looking at what's similar saying they were not making that kind of generalized and they were saying in fact you should have paid the tax but because there was confusion will will forgive it for a couple for a year or two but it was not a generalized principle that oh because this is functionally the equivalent or sanctioning they're arguing for such a principle yet that would reach that conclusion with regard to the filipinos and c m i but also with respect to the chinese family and i suppose any let me just address briefly that very last point about the suppose an amnesty period what that i r s did in that bulletin in two thousand and twelve was agree country what it said a year earlier to continue the policy that had been in effect throughout the relevant period of recognizing in the c n n my the same exception that applies in guam so wasn't it was just a limited annecy period was a policy that applied throughout the years are at issue here and you're correct your honor that our point is that you have to look at this at the appropriate level of generality and that in this case and entails looking at that scene of ice immigration policies and its economy economic circumstances and applying the same principles that