§ 253. “Laws Imposing Taxation.”

As section 54 prohibits the “tacking” of extraneous matters to appropriation bills, so this section prohibits the tacking of extraneous matters to “laws imposing taxation.” The difference between “proposed laws” and “laws” (see Note, § 240, supra) becomes clear, when we compare the two sections. If the words of this section had been “proposed laws imposing taxation shall deal only with the imposition of taxation,” compliance with the direction would have been required merely as a matter of order between the two Houses; and violation of the direction would not have invalidated the law, when finally passed. In this section, however, the word “proposed” is deliberately omitted; the mandate is that “laws” imposing taxation shall deal only with taxation. If it had stopped there, absolute nullity would have been the penalty of the whole of an Act purporting to impose taxation and dealing with any other matter. This was the form of the section as settled by the Adelaide Convention. The remainder of the paragraph, “and any provision therein dealing with any other matter shall be of no effect,” was added, under circumstances hereafter to be mentioned, at the final session of the Convention in Melbourne.

The principle of this limitation in favour of the Senate forms part of one of the compromises of the Constitution, in consideration of which the House of Representatives was endowed with the exclusive power to originate Money Bills, and the Senate was deprived of the power to amend bills imposing taxation and appropriating revenue or money for the ordinary annual services of the Government. The compromise itself was not strongly objected to in the Convention. What was objected to was the form of the limitation and the penalty of the absolute nullity of every law which violated the limitation. If the word “bills” or the phrase “proposed laws” had been used in place of “law,” the section would have been accepted without demur, as a part of the compromise. The whole of the debates on the section, which began in Adelaide and ended in Melbourne, rallied around the question whether the section should read “laws imposing taxation,” or “proposed laws imposing taxation.” In the Adelaide Convention

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an effort was made by Mr. Isaacs, Mr. Kingston, and Mr. Reid, to omit the word “laws” and insert the word “bills,” or alternatively to insert the word “proposed” before “laws.” Such an alteration would, as we have already seen, leave to the Senate the responsibility of enforcing the provision in its favour, by laying aside bills which violated the Constitutional prohibition; it would not have permitted Acts of the Federal legislature to be reviewed by the Federal Courts, and declared void, on mere questions of form and order. It was pointed out that as the section was intended for the benefit of the Senate, that chamber should be allowed, if it thought fit, to waive the privilege without endangering the validity of the law; it would be disastrous if, after a bill imposing taxation had been passed by both Houses and received the Royal assent, and after, perhaps, it had been brought into operation and revenue collected thereunder, it could be assailed in a court of law. Moreover, attention was drawn to the invidious distinction between this section, protecting the rights of the Senate, and the preceding section protecting the rights of the House of Representatives. It would be unfair that non-compliance with this section should be fatal to the validity of a law, if non-compliance with the preceding section were not. On the other hand the distinction was justified on the ground that the origination and amendment of money bills involved mere matters of procedure between the two Houses—matters in which the two Houses only were concerned; and if any violation thereof took place it would not appear on the face of the law, and consequently could not be considered by the Courts, unless proved by extrinsic evidence; whereas if a tax Act contained provisions irrelevant to taxation such irrelevant matters would appear on the face of the Act, and would be examinable by the Courts without such evidence.

In order to secure Federal taxation Acts against the possibility of attack in the Federal Courts, it was suggested that a distinct sub-section should be inserted providing that such Acts, when passed, should not be liable to be called in question in respect to any breach of the provisions of the section. Another suggestion was that any accidental failure to comply with the provisions of the section should not invalidate a law. But neither of these suggestions was accepted.

In reply to the argument that the Senate could protect itself, and should be allowed to waive its privileges, without endangering the law, it was said:—

“A law which may be introduced, in violation of one of these sub-sections, may be believed to be a violation by the Senate, and thrown out on that ground, and be sent back. It may be sent up again by the House of Representatives, and so by that way you have a question which, instead of being settled, becomes a matter of contest between the two Houses. Another matter of difference between the two Houses we know. It is where one House happens to take an unpopular view of a question—a view which for the time being is not the view of the majority of the people. We know it is easy to bring the pressure of the majority of public opinion on one House for the purpose of obtaining a violation of the law. This is not intended to be a protection to the House or the Representatives of the House, but to the States represented in the House; that no matters of tactics between the Houses, or no playing off of public opinion by one House against another, shall ever take away the protection embedded in the Constitution for the States. I have heard of the argument of the inconvenience of laws being upset on account of some invalidity being discovered—some trifling invalidity, perhaps. I say you must submit to that inconvenience if you wish to enter a Federal Constitution. The very principle of the Federal Constitution is this: that the Constitution is above both Houses of Parliament. That is the difference between it and our Houses of Parliament now. The Federal Constitution must be above both Houses of Parliament, and they must conform to it, because it is in the Charter under which union takes place, and the guarantee of rights under which union takes place; and, unless you have some authority for them to interpret that, what guarantee have you for preserving their rights at all. It is very necessary to insert this provision in the Constitution, because if you do not do that then these questions are questions of procedure between the two Houses, in which undue pressure may be brought to bear at any time on one House or other for the purpose of vetoing a law and doing injustice to the States represented in that House in the different ways in which the States are represented. (Mr. R. E. O'Connor, Conv. Deb., Adel., pp. 591-2.)

“Parliament is not supreme, and the very essence of the Federation is that it should not be so. Parliament, as far as constitutional questions are concerned, is under

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the law, and it must obey the law. If we make an exception in regard to Money Bills we had better make an exception in the case of all other Bills which may arise under the provisions of clause 51, and thus sweep away the High Court. I thought that we were all agreed that the reason for the establishment of the High Court was a salutary one, and that it would determine constitutional law and practice. We must all remember that at one portion of the history of England a question of liberty was raised by a humble individual named John Hampden, who put forward a point on the subject of taxation. We do not know but that we may have John Hampdens in Australia raising questions of liberty; it would be well to leave the High Court of Australia to deal with such matters as that.” (Mr. J. H. Symon, Id., p. 594.)

At the Melbourne sittings of the Convention, the contest was renewed. An amendment was submitted by Mr. Isaacs, to insert the word “proposed” before “laws.”

Once more the question was exhaustively debated. At last a middle course was agreed to. The amendment to insert the word “proposed” was negatived, but the words were inserted providing that in the event of extraneous provisions being inserted in a taxing act, the extraneous provisions only—and not the whole law—should be invalid.