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§ 254. “The Imposition of Taxation.”

During the debate on the financial sections 53 and 55, the meaning of the expression “the imposition of taxation” was discussed, and the question raised whether a law imposing taxation and also providing for its collection would be ultra vires of the Constitution. Doubts were suggested whether the restriction that tax bills should deal only with the imposition of taxation might not be read so as to exclude from tax bills the ordinary machinery clauses, providing for the assessment and valuation of property, the subject of taxation, and for the enforcement and collection of the tax.

Referring to this point, Sir Samuel Griffith wrote: “A more serious question is whether provisions regulating the collection of taxes should be allowed to form part of the same laws by which the amount of the tax is fixed. This point should be clearly settled and expressed.” (Notes on the Draft Federal Constitution, 1897, p. 9.) Mr. Isaacs understood this note to mean that “imposing taxation” does not include collection and machinery. (Conv. Deb., Melb., p. 2049.) Mr. Barton was inclined to think that, according to the well-known principle that the grant of a power includes all the necessary means for its effective exercise, the exclusive power given to the House of Representatives to originate bills “imposing taxation” would carry with it the subsidiary power to provide machinery in the same Bill for the collection of the taxes. It was pointed out that according to the practice observed in some constitutionally governed countries, taxing bills, fixing the nature, amount, and incidence of proposed taxes, were kept separate and distinct from machinery bills, dealing with such details as collection, assessment, and valuation. “Would not the power of collection be embraced in the power to impose taxation?” asked Sir Edward Braddon. (Conv. Deb., Melb., p. 2056.) Mr. Barton said that power to collect would be, ordinarily, included in the power to impose taxation, but in a section such as this, so strong in its intention to restrict laws imposing taxation to the mere imposition of taxation, it might be as well to remove doubt by adding after “imposition” the words “and collection.” It was pointed out, however, that as the Senate was prohibited from amending proposed laws imposing taxation, the addition of the words “and collection” would have the effect of depriving the Senate of the power to amend matters in a tax Bill, relating to its method of collection.

“I confess that when I first proposed the amendment I did not see the extent to which it went. But, having appreciated the extent to which it goes, I still feel bound to adhere to it. The difficulty that would arise unless you allowed the House of Representatives to include in these Bills the ordinary powers of assessment and collection would be, that, while you might have a certain tax imposed in the Bill fixing the amount of the tax, the machinery Bill might be so subject to amendment by the Senate that the whole financial policy of the Government which introduced it, with a majority of the


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House of Representatives behind them, might be entirely subverted. That is a difficulty which, I think, none of us wish to create. Therefore, I am prepared to take the responsibility of adhering to the amendment. Holding the position I have always held, that the Senate should be a real body and not a mockery of State interests—while it should be a Second Chamber holding definite powers and rights as expressing the will of the people within the States which it represents — I have also held that we should only carry responsible Government into effect by making it real and effective, and a power of amending a machinery Bill to the extent of making a tax not worth collecting would be equal to the power of amending a Bill imposing taxation.” (Mr. E. Barton, Conv. Deb., Melb., p. 2060.)

“All I am endeavouring to do is to attribute a meaning to words in this Constitution, which I believed in Adelaide—and I explained my belief as I have read—that they did convey, which I am inclined to believe now they do convey, without a special explanation; but as to which I am in serious doubt, because of the very strong express nature of the words ‘shall deal with the imposition of taxation only.’ It is in order to remove that doubt, and for that purpose only, that I wish these words to be inserted, and I really do believe that the insertion of the words will carry out the real spirit of the understanding of 1891.” (Id. p. 2067.)

Mr. Barton's amendment to add the words “and collection” was rejected by 26 votes to 16. But see Note, § 248, supra.

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