Is Victorian Land Tax Discriminatory and therefore Invalid?

It appears in Victoria we have differential discriminatory land tax laws, the power of taxation comes from section 51 of the Commonwealth Constitution.

 

 

COMMONWEALTH OF AUSTRALIA CONSTITUTION ACT - SECT 51

Legislative powers of the Parliament

The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to:

                     (ii)  taxation; but so as not to discriminate between States or parts of States;

 

 

 

 

LAND TAX ACT 2005 - SECT 34A

Imposition of vacant residential land tax

(1) Vacant residential land tax is imposed each year on taxable land in Victoria that is—

(a) residential land which is vacant; and

(b) within the specified geographic area.

(2) Vacant residential land tax is imposed in addition to any other land tax imposed under this Act.

Note

Certain taxable land is exempt from vacant residential land tax—see Division 9 of Part 4.

 

 

 

Victoria has 79 council areas, yet only 16 areas are within a specified geographic area and susceptible to land tax, a discrimination against parts of the State.

 

 

LAND TAX ACT 2005 - SCHEDULE 2A

Schedule 2A—Specified geographic area

Section 34D

Banyule City Council

Bayside City Council

Boroondara City Council

Darebin City Council

Glen Eira City Council

Hobsons Bay City Council

Manningham City Council

Maribyrnong City Council

Melbourne City Council

Monash City Council

Moonee Valley City Council

Moreland City Council

Port Phillip City Council

Stonnington City Council

Whitehorse City Council

Yarra City Council

 

 

QUICK & GARREN ANNOTATED CONSTITUTION.

DISCRIMINATIONS.—The Federal Parliament may not impose a tax which discriminates between States or parts of States (s. 51—ii.) This is a limitation which has been provided for federal reasons, viz., for the protection of States which might not possess sufficient strength in the Federal Parliament to resist the imposition of a system of taxation designed to press more heavily on people or property in some States than on people or property in other States. To discriminate obviously means to make differences in the nature, burden, incidence and enforcement of taxing law; to impose a high tax on commodities or persons in one State and a low tax on the same class of commodities or persons in another State, would be to discriminate. Such discriminations are forbidden, and uniformity of taxation throughout the Commonwealth is an essential condition of the validity of every taxing scheme. Any deviation from this rule would invalidate a tax. The provision against discrimination is practically the same in substance as the requirement of Art. 1, s. 8, sub-s. 1, of the United States Constitution that “all duties, imposts and excises shall be uniform throughout the United States.' It has been held in that country that “uniform” means at the same rate on the same article wherever found. (Head Money Cases, 112 U.S. 580; Burgess, Pol. Sci. ii. 151.)

 

TAXING POWER NOT EXCLUSIVE.—The power of taxation vested in the Federal Parliament is not exclusive, except to the extent and in respect of matters as to which it is declared exclusive by the Constitution, or is so by necessary implication. The only taxes which by express words are exclusively vested in the Federal Parliament are duties of customs and excise (sec. 90). Upon the imposition of uniform duties of customs the power of the Parliament to impose duties of customs and excise becomes exclusive. With respect to other subjects of taxation the States possess the concurrent power of levying taxes, within their jurisdiction, subject to the restrictions, (1) that they cannot tax public property of any kind belonging to the Commonwealth (s. 114); (2) that by necessary implication they cannot tax any of the constitutional means or instruments employed by the Commonwealth (McCulloch v. Maryland, 4 Wheat. 316); (3) that they cannot tax the compensation or official income of officers of the Commonwealth. (Dobbins v. Erie County, 16 Pet. 435; Leprohon v. City of Ottowa, 1878, 2 Ontario App. Rep. 522; Wheeler, C.C. p. 70.

 


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