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	Murdoch University Electronic Journal of Law

E LAW - MURDOCH UNIVERSITY ELECTRONIC JOURNAL OF LAW
VOLUME 1 NUMBER 4 (DECEMBER 1994)
Copyright E Law and/or authors

Review of Western Australian State Taxes 1994
Chapter 4 THE CONSTITUTIONALITY OF STATE PETROL TAXES

Part One: The Scheme
Part Two: The Law
Part Three: Application of the Law to the Scheme
Part Four: Recommendation
Bibliography

INTRODUCTION

This chapter will be divided into four main sections. The first will
establish the State's power to levy petrol taxes, while identifying section
90 of the Constitution as the main limit on such a power. It will further
identify the legislative scheme that is the focus of this chapter, and
highlight the principal elements of the Act that are essential to a
discussion of its constitutionality.

The second section will give a brief history of the case law on section 90,
focusing on the term "duties of excise".

The third and most important section will identify the major factors used
by the High Court in recent cases in deciding whether a particular Act
imposes a duty of excise. Concurrently, the legislative scheme identified
in part one will be analysed in light of these factors, and a conclusion
reached on its constitutional validity.

Finally, part four will explore possible recommendations that would avoid
the Act being struck down.

PART ONE: THE SCHEME

The Nature of State Tax Power

Generally the States have broad powers to levy taxation. The Commonwealth
Constitution assumes that States will continue to raise revenue through
taxation. This is because the Commonwealth's power under section 51(ii) is
not exclusive, and section 107 declares that State Parliaments shall
inherit all those powers of the former colonial parliaments which are not
vested exclusively in the Commonwealth Parliament. The Constitution,
however, places certain express prohibitions on this general taxing power
of the States, the relevant one for our purposes being the "excise duties"
prohibition in section 90.

The Legislative Scheme

There may be numerous legislative schemes in Western Australia that may be
investigated to determine whether a petrol tax is imposed.[1] This chapter
will deal only with Part IIIA of the Transport Co-ordination Act 1966 (WA),
- hereinafter referred to as "The Scheme"- entitled Business Franchise
(Petroleum Products) Licensing. This is because this scheme constitutes the
major source of revenue from petrol for the State,[2] and is in the form of a
business franchise licence fee, the constitutionality of which has been the
centre of great debate.

The Scheme provides[3] that "A person shall not on or after 1 July 1979 carry
on the business of wholesaling petroleum products unless he is the holder
of a licence".[4] The Minister has the power to grant such a licence pursuant
to an application in the approved form.[5] However the licence cannot be
granted until the "fee payable in respect of the licence has been paid".[6]
The licence commences on the date specified, and ceases to have effect
after a maximum of one month. For licences issued prior to 1 July 1986, the
maximum period was one year.[7] The following table provides a summary of the
fees payable.[8] It deals with licence fees for petroleum products[9]
wholesaled[10], providing information from inception of The Scheme in 1979 to
the present.

Table I: Table of Business Franchise (Petroleum Products) Licence Fees[11]

Year (end 30 June) Licence Fee Formula Revenue($M)

1979-80 $500 + 0.90 c/L(msp) + 3.00 c/L(d) 16.905
1980-81 $500 + 1.30 c/L(msp) + 3.00 c/L(d) 24.439
1981-82 $500 + 1.60 c/L(msp) + 3.00 c/L(d) 29.031
1982-83 $500 + 1.85 c/L(msp) + 3.40 c/L(d) 34.038
1983-84 $500 + 2.10 c/L(msp) + 3.85 c/L(d) 41.246
1984-85 $500 + 2.17 c/L(msp) + 3.95 c/L(d) 43.971
1985-86 $500 + 2.17 c/L(msp) + 3.95 c/L(d) 46.042
1986-87 $ 50 + 4.17 c/L(msp) + 5.95 c/L(d) 98.162
1987-88 $ 50 + 4.17 c/L(msp) + 5.95 c/L(d) 91.023
1988-89 $ 50 + 4.17 c/L(msp) + 5.95 c/L(d) 88.173
1989-90 $ 50 + 4.17 c/L(msp) + 5.95 c/L(d) 137.645
1990-91 $ 50 + 5.54 c/L(msp) + 7.29 c/L(d) 131.196
1991-92 $ 50 + 5.67 c/L(msp) + 7.38 c/L(d) 131.087
1992-93 $ 50 + 5.67 c/L(msp) + 7.45 c/L(d) 136.642
1993-94 $ 50 + 5.67 c/L(msp) + 7.45 c/L(d) 130-140 (est)

For the first year calculation of fees is made by reference to volume of
motor spirit and diesel wholesaled during one year backwards from 31 March
1979.[12] For the licence periods between 1 July 1980 and 30 June 1986,
calculation of fees is also made by reference to volumes wholesaled by the
applicant in the year ending 31 March last preceding.[13] Reference needs to
be made to regulations[14] to determine the amount payable in respect of each
volume of petroleum product wholesaled in the relevant reference period.[15]
However, in calculating fees for periods commencing after 30 June 1986,
reference needs to be made to the regulations for both the amount payable
in respect of each volume wholesaled and for the relevant reference period.
From 1 July 1986 the reference period begins two months immediately prior
to the month in which the licence commences.[16]The revenue estimate for 1993
- 94 represents approximately 6.5 % of WA's total revenue.[17] Compare this
with tobacco tax 9.6% ($188M) and liquor tax 3.2% ($62M).[18] It is also
important to note that the licence fee imposed, assuming it is passed on
directly to the consumer, constitutes 8.17% of the total retail price of
the product.[19]The licence fees imposed by The Scheme are collected from
only seven or eight persons, thus making it perhaps the most simple tax in
WA. Of the revenue raised,[20] only about 4% is spent by the Department of
Transport (WA). Of this 4%, there are two main uses: (1) Road Safety
advertising campaigns and (2) maintenance and rebuilding of roads.[21]

Does the Legislative Scheme Impose a Tax?

Before we can test the constitutional validity of The Scheme, it must be
established that it in fact imposes a tax. In Philip Morris Ltd v
Commissioner of Business Franchises,[22] it was said that licence fees
exacted for the privilege of manufacturing, producing, selling, or
distributing a commodity, and calculated by reference to the value or
quantity of the commodity manufactured, produced, sold or distributed by
the licensee during a particular period, have the attributes of a tax. In
support of this conclusion is the fact that the fees imposed by The Scheme
are compulsory for persons wishing to wholesale petrol products.
Furthermore they cannot be said to be requited payments, in the sense that
the fees paid are not directly proportional to the value of specific
services, property[23] or privileges rendered in return.

PART TWO: THE LAW

As outlined earlier, the main hurdle to the constitutionality of The Scheme
is the first limb of section 90 of the Constitution. The first limb states,
that:On the imposition of uniform duties of custom the power of the
[Commonwealth] Parliament to impose duties of custom and excise, and to
grant bounties on the production or export of goods, shall become
exclusive...

This section has produced three main areas of judicial debate over the
years. The first relates to the purpose of section 90.

In the various judgements there can be detected two main alternatives to
the constitutional purpose of section 90: the centralising of tariff
policy, and the centralising of commodity taxes. The first view seeks to
preserve the State's fiscal autonomy, however, the second view is the
dominant one. Adopted by the majority in Capital Duplicators v ACT
[No.2],[24] the latter view ensures "that differential taxes on goods and
differential bonuses on the production or export of goods should not divert
trade or distort competition".[25]The second area of debate relates to the
definition of 'duties of excise'. The main area of concern is at what step
in the process must the tax be imposed to be deemed an excise. The first
important case, Peterswald v Bartley,[26] concluded that a duty of excise was
"analogous to a customs duty imposed upon goods either in relation to
quantity or value when produced or manufactured".[27] However beginning with
Matthews v Chicory Marketing Board,[28] and concluding with the majority
decision in Bolton v Madsen,[29] the narrow approach in Peterswald was
gradually widened. In Bolton, it was held that a duty of excise is a tax
"directly related to goods imposed at some step in their production or
distribution before they reach the hands of consumers".[30] This definition
recognises that a tax on consumption is beyond the section 90
prohibition.[31]The third and final major debate concerned the test to be
used when determining how "closely related to goods" the tax must be to be
an excise, ie. must it have a closer connection with production and
distribution than a mere exaction for the privilege of engaging in a
business. Early cases like Bolton and Dennis Hotels Pty Ltd v Victoria[32]
were authority for the adoption of the 'criterion of liability' test, which
focused on the form of the legislation. However in Capital Duplicators
[No.2], the majority formally rejected this approach. They adopted the
'practical effect' test, which looks at the substance of the legislation in
question and attempts to identify if, in effect, the tax amounts to a
burden on the goods to be later passed on to the consumer.

Thus it is now important to identify the factors that recent cases have
used in determining whether particular legislation imposes, in substance, a
duty of excise. These factors, "which may or may not be present in every
case and which may have different weight or emphasis in different cases",[33]
will be simultaneously applied to The Scheme, and a conclusion then reached
on its constitutionality.

PART THREE: APPLICATION OF THE LAW TO THE SCHEME

Barwick CJ's Considerations

The starting point in most of the recent judgments is Barwick CJ's
statement in Anderson's Pty Ltd v Victoria that the relevant considerations
included the "indirectness" of the tax, it's immediate entry into the costs
of the goods, the proximity of the transaction it taxes to the manufacture
or production or movement of the goods into consumption, [and] the form and
content of the legislation imposing the tax...[34]The price elasticity of
demand for petroleum products is fairly low.[35] This relative inelasticity
means that the incidence of the tax is principally on the consumer. This
means that the tax will be indirect in the sense that it "is demanded from
one person in the expectation and with the intention that he shall
indemnify himself at the expense of another"[36].Although the legislation
ostensibly taxes sales in a prior period by reference to volume wholesaled,
the requisite proximity to manufacture or production of goods may yet be
established. The presence of a back-dating device such as the Dennis Hotels
formula may still mean that the fee has a closer connection than is
valid.[37]

Is the Legislative Scheme Regulatory in its Principal Elements?

In Philip Morris and especially in Capital Duplicators [No.2], considerable
weight was attached to the provision in the legislation which prohibited
sales without a licence. As early as Dennis Hotels, Taylor J was concerned
that such a provision should be a substantive one and not merely an adjunct
to a revenue statute if it were to support a characterisation of the impost
as something other than an excise.[38]If a licence is available to all those
who are prepared to pay the fee, then a genuine privilege is not conferred
by the granting of a licence.[39] There are no trade restrictions imposed by
The Scheme on WA licence holders, nor are any restrictions imposed for the
protection of the public. The only condition that has to be satisfied by an
applicant is more obviously related to guaranteeing payment than protection
of the public.[40] Nor is there a discretion to refuse a licence or impose
conditions on grounds related to the manner or place of conducting a
petroleum products business.[41]Petroleum products have certain
characteristics which invite regulatory control. The use of petroleum
products has certain negative externalities such as pollution and traffic
congestion and even the infrastructure provided for most petroleum users.[42]
In order to control the increase in these negative characteristics of
petroleum consumption, it may be appropriate to control the sale and
distribution of petroleum products.[43] However, the issue of licences is not
a traditionally accepted method of regulating the sale and consumption of
petroleum products in the interests of the public.[44]The size of the fee
exacted under section 47N (approximately 8% of the retail price of petrol)
clearly exceeds the cost of implementing any scheme envisaged by the Act.
In Capital Duplicators [No.2], the majority considered that, especially in
relation to petrol, where the magnitude of the fee is such as to deny a
regulatory character to the law which imposes it, the validity of the fee
would require closer attention.[45]From even a brief analysis of The Scheme,
it can be seen that it is principally for revenue raising, not regulation
and therefore the fee imposed is likely to be a "duty of excise".

Is the Proximity of the Prior Period, the Length of the Licence and the
Existence of any Exemptions such that there is a Strong Relationship
between the Fee and the Goods Sold?

In Philip Morris, Brennan J stated that

when the proximity of the two periods is such that the transactions of the
prior period are referred to merely to provide a reliable forecast of the
transactions that will occur during the currency of the licence[46]then the
licence fee is more likely to be declared an excise. This is partly based
on Stephen J's observation in Dickenson's Arcade[47] that the "very act of
measuring the amount of tax by reference to the number, weight, volume or
value of the goods dealt in will usually be explicable only as disclosing
that what is being taxed is the taxpayer's dealing with those goods"[48].The
duration of the licence currently stands at one month: section 47M. The
usual period for licences for engaging in any business, sporting or social
activities is a year.[49] The shorter the licence period and the more
proximate the prior period, the more reliable the forecast is when a
back-dating device is used such as in The Scheme.

The terms of the legislation operate to ensure that the fee is paid once
only, from which an inference might be drawn that "its purpose is to ensure
that in the ordinary course of distribution, petroleum products will be
taxed but once before they reach the consumer".[50]At this stage in the
analysis, general principle leads to the conclusion that The Scheme imposes
a duty of excise and is therefore unconstitutional.

Degree of Similarity to the "Franchise Cases"

Due to State government reliance on past decisions of the High Court and in
the interests of certainty in federal fiscal arrangements in an area which
is historically devoid of judicial consensus, the High Court has had to
fashion any later principles around three decisions: Dennis Hotels,
Dickenson's Arcade and H C Sleigh[51]. These cases are good authority for
their results in similar circumstances only[52] and are not to be taken as
authority for a "rigid dichotomy between licence fees and excise
duties".[53]The Scheme is based on the volume of petroleum products
wholesaled in a one month period beginning two months prior to the month in
which the licence commences. This is exactly the situation which was
declared to be an excise in Capital Duplicators [No.2]. The only difference
between that case and the present situation is that we are here concerned
with petroleum products, and H C Sleigh is a decision which ruled that a
licence fee on petrol can be valid.

In H C Sleigh there was a three month licence period. The prior reference
period was twelve months and finished approximately three months[54] before
the licence period started. The decision represents the smallest allowed
periods.[55]For the above reasons The Scheme is not sufficiently similar to
any of the franchise cases to warrant a different conclusion on its
constitutionality than that reached through general principle earlier. Thus
in the light of this, the next section will explore several recommendations
that will avoid The Scheme being struck down and the resultant damage
caused.[56]

PART FOUR : RECOMMENDATION

It is submitted that a wide interpretation of section 90 is unjustified and
superfluous. First, section 90 reserves limited power for economic
control.[57] States have the ability to impede Commonwealth policies through
other legislative measures which can discourage or encourage economic
manufacture.[58] Second, it narrows the State tax base thereby effecting
their ability to function independently.[59] This forces them to impose taxes
which are regressive, inefficient and complex in an attempt to avoid having
the taxes struck down. A change in the current position of the law is
necessary to avoid the Scheme being struck down and to provide general
certainty in the law. If constitutional validity were undoubted, existing
vertical imbalance[60] could be minimised and a single administratively
efficient sales tax could be imposed.[61] Such taxes could be easily
monitored by the Commonwealth, increasing its capacity to control the
economy.

A strong prima facie case for giving the States power to levy excise duties
exists. Such a power could be granted in the following ways:

1. Judicial Interpretation: Return to Peterswald

Merely waiting for a return to the Peterswald definition would be an
unsatisfactory solution. Up to now judicial interpretation has not been a
suitable avenue for improvement. If left to the judiciary, a real
possibility exists for further complication and uncertainty to arise, not
to mention the time wasted waiting for a particular factual circumstance to
be brought forward.[62]

2. Legislative Drafting

Creative State legislative drafting techniques are not viable means to
enable States to levy excise duties.[63] A false sense of constitutional
security could result by extending the one month licence period involved to
12 months and introducing a regulatory element. Greater inefficiency,
inequity and costly complex tax structures would eventuate from attempting
to negotiate dubious loopholes in the array of current High Court
decisions.

3. Constitutional Amendment

The only real solution is to "cut the Gordian knot" [64] and amend the
Constitution. The possible omission of "and of excise" from section 90 was
suggested in The Report of the Royal Commission on the Constitution (1929)
[65] and in The Fiscal Powers Sub-Committee Report to the Australian
Constitutional Convention (1985),[66] later to be one of the Convention's
recommendations. These proposals were in vain. Even the more general
interchange of a powers proposal which permitted the Commonwealth "to
designate any of its exclusive powers as matters about which a State could
make laws" failed to pass the electors in 1984.[67] In 1988 the
Constitutional Commission again submitted these recommendations.
Alternatively, it recommended that the States be permitted to levy excise
taxes as approved by a resolution of both Houses of Federal Parliament.[68]
It is yet to be seen whether any will be implemented.[69]The uncertainty
surrounding the Commonwealth's ability to sufficiently and effectively
control State taxes has been the major determinant inhibiting an amendment
of section 90. Gibbs CJ and Murphy J suggest in Hematite[70] that if a State
tax is found to be burdensome on federal activity, then the exercise of
heads of Commonwealth power (such as for example section 51(ii) and (iii))
would attract section 109, thereby invalidating the State taxation laws due
to inconsistency.[71] Mason and Murphy JJ concluded that a law enacted under
section 51(ii) providing that no excise duties be payable on specific goods
would prevail over any inconsistent State law because of section 109.[72]
Hence the presence of section 109 may well render unnecessary a reference
to duties of excise in section 90. However, a number of factors detract
from the strength of this argument. Firstly, the power of the Commonwealth
to legislate under section 51(ii) and (iii) is subject to the qualification
that the law must not discriminate between States or parts of States.[73]
Secondly, it cannot infringe the limitations on federal legislative power
implied by the nature of the Constitution.[74] Thirdly, practical and
political constraints on the Commonwealth's ability to enact legislation
rendering State law inoperative do exist.[75]Therefore, although the High
Court has pointed to the ability of the Commonwealth to legislate so as to
control State taxing power in the absence of the "duties of excise"
prohibition, it might not in fact allow it.[76] Nevertheless the argument
proposed is a possibility and adds another dimension to the debate until
resolved.

In any case the Commonwealth has sufficient constitutional power in
relation to different types of taxes and sufficient political and economic
power to deal with any difficulties that might arise.[77] Therefore, section
109's applicability to section 51(ii) and (iii) can be put to one
side.Interim ReliefIt is submitted that the alternative recommendation that
States be permitted to impose excise duties subject to approval of both
Houses of Federal Parliament is the best short term solution. The
Commonwealth would be in a position to control what excises the State could
levy ensuring certainty and flexibility is provided while being able to
test the waters until the more suitable solution of a section 90 amendment
is implemented.

BIBLIOGRAPHY

CALEO, C., "Section 90 and Excise Duties: A Crisis of Interpretation"
(1987) 16 MULR 296 [Travels through s.90's history highlighting the
judicial approaches to definition, purpose, history and precedent which has
shaped interpretation of s.90. Hematite Petroleum and Gosford Meats are
examined in greater depth.]

CONSTITUTIONAL COMMISSION (1988) [Recommendations are forwarded with
justifications. Very helpful in providing an understanding of what the
state of the law is currently and where the law should be heading.
Incorporates: The Report of the Royal Commission on the Constitution (1929)
and The Fiscal Powers Sub-Committee Report to the Australian Constitutional
Convention (1985).]

DIXON, N., "Section 90 - Ninety Years On" (1993) 21 Fed Law Review 228 [A
more recent article which concentrates on the High Court decision in
Phillip Morris.]

HANKS, P., Australian Constitutional Law, Materials and Commentary (5th
ed), Butterworths, Sydney, 1994 [Provides a money saving collection of
extracts of the relevant cases in the High Court's history of
interpretation of s.90. Also contains a critical analysis of most of the
major judgements.]

HANKS, P., "Section 90 of the Commonwealth Constitution: Fiscal Federalism
or Economic Unity" 10 (3) September 1986 Adelaide Law Review 365 [Article
is based on economic arguments of the purpose of s.90 enunciated by the
proponents of both the wide and the narrow views of purpose. Useful to see
the various views on the constitutional purpose behind s.90.]

OPESKIN, B., "Section 90 of the Constitution and the Problem of Precedent"
(1986-1987) 16 Fed Law Review 170 [Similar to the Caleo article.
Specialises and emphasises the issue of following precedent.]

TAX POLICY ELECTIVE, 1993 Review of Western Australian State Taxes

"The Necessity of Amending Section 90 of the Constitution" 57(11) November
1983 Australian Law Journal 599 (under Current Topics) [Short extracts
discussing the necessity for an immediate amendment to s.90. It does not go
into any depth, but may be used for a superficial grasp of the issues
involved.]

Notes:

[1] The range is limited by whether the scheme imposes "tax" as such, and how
wide one construes the generic term "petrol". Some possibilities (ie.
legislative schemes) include:

1. Transport Coordination Act 1966, Part IIIA (ss.47K - 47N).
2. Liquid Petroleum Gas Act 1956, Part IV s.2(3).
3. Petroleum Act 1967, Division 7 and s.153.
4. Petroleum Pipelines Act 1969, ss.8 (1)(j).
5. Petroleum (Registration fees) Act 1967, ss.4 & 5.
6. Petroleum Retailers Rights and Liabilities Act 1982, s.6.
7. Petroleum (Submerged Lands) Act 1982.
8. Petroleum (Submerged Lands) Registration Fees Act 1982.
9. South Fremantle Oil Installations Pipeline Act 1948.

[2] See text accompanying infra note 16.

[3] See section 47G for definitions of terms in Part IIIA.

[4] Section 47K.

[5] Section 47L, subs.(1) & (2).

[6] Section 47L (3).

[7] Section 47M.

[8] Section 47N.

[9] Defined in section 47G as motor spirits or diesel.

[10] Also defined in section 47G.

[11] Motor spirit is "msp", diesel is "d", and cents per litre is "c/L";
information extractable from relevant regulations, and on revenue, has been
provided by the Department of Transport WA. N.B. 1993-94 "official revenue
estimate is lower, namely $127.078M. See WA 1993-94 Consolidated Fund
Estimates for the Year Ending 30 June, 1994, p.8.

[12] A minimum of 3 months and a maximum of 15 months prior to the beginning
of the licence period.

[13] See note 11.

[14] Made under section 47X.

[15] Cf. first year, where there is no regulation determining the reference
period.

[16] E.g. For a licence commencing in May 1994, and ending 31 May 1994,
reference will be made to the volume wholesaled by the applicant during
March 1994.

[17] "Revenue" means total taxes and licences. Thus, inter alia, Commonwealth
grants "revenue" is excluded.

[18] See WA 1993-94 Consolidated Revenue Fund Estimates, supra note 11.

[19] April 1994, RAC Road Patrol, RAC of WA Inc, p.52. N.B. Federal
Government Product Tax of 30.8 c/L and Federal Government Resource Rent Tax
of 3.2 c/L.

[20] Section 47W provides for payment of the fees into the Mains Roads Trust
Fund.

[21] Department of Transport WA.

[22] (1989) 63 ALJR 520 at 525.

[23] Harper v Minister for Sea Fisheries (1989) 63 ALJR 687.

[24] (1993) 118 ALR 1, Mason CJ, Brennan, Deane, McHugh JJ.

[25] Capital Duplicators v ACT [No.2] (1993) 118 ALR 1 at 8.

[26] (1904) 1 CLR 497.

[27] Peterswald v Bartley (1904) 1 CLR 497 at 509.

[28] (1938) 60 CLR 263.

[29] (1963) 110 CLR 264.

[30] Bolton v Madsen (1963) 110 CLR 264 at 271.

[31] See in particular Dickenson's Arcade Pty Ltd v Tasmania (1974) 130 CLR
177.

[32] (1960) 104 CLR 529.

[33] Mason and Deane JJ in Gosford Meats Pty Ltd v New South Wales (1985) 155
CLR 368 at 384, basing it on Barwick CJ's views in Anderson's Pty Ltd v
Victoria (1964) 111 CLR 353 at 365.

[34] (1964) 111 CLR at 365.

[35] Dahl, C. and Sterner, T. "Analysing Gasoline Demand Elasticities: A
Survey" in (1991) 13 Energy Economics 203. -0.26 in the short run, -0.86 in
the long run.

[36] Matthews v Chicory Marketing Board (1938) 60 CLR 263 at 300, taken from
A-G for Manitoba v A-G for Canada [1925] AC 561 at 566.

[37] Philip Morris Ltd v Commissioner of Business Franchises (1989) 63 ALJR
520 at 535-539 (Brennan J).

[38] Dennis Hotels Pty Ltd v Victoria (1960) 104 CLR 529 at 576.

[39] Philip Morris Ltd v Commissioner of Business Franchises (1989) 63 ALJR
520 at 550 (Toohey & Gaudron JJ).

[40] Capital Duplicators v ACT [No.2] (1993) 118 ALR 1 at 17 (Majority). See
s.47I Investigation, s.47R Accounts to be kept, s.47S Power to require
information, s.47Q Transfers (Minister SHALL transfer upon receipt of
money).

[41] Philip Morris Ltd v Commissioner of Business Franchises (1989) 63 ALJR
520 at 540 (Brennan J).

[42] Tax Policy Elective, 1993 Review of Western Australian State Taxes, at
p.95.

[43] Philip Morris Ltd v Commissioner of Business Franchises (1989) 63 ALJR
520 at 531 (Mason CJ & Deane J)

[44] Supra note 42.

[45] Capital Duplicators v ACT [No.2] (1993) 118 ALR 1 at 14 (Majority).

[46] Philip Morris Ltd v Commissioner of Business Franchises (1989) 63 ALJR
520 at 538.

[47] (1974) 130 CLR 177.

[48] Dickenson's Arcade Pty Ltd v Tasmania (1974) 130 CLR 177 at 235.

[49] Philip Morris Ltd v Commissioner of Business Franchises (1989) 63 ALJR
520 at 550 (Brennan J), 554 (McHugh J).

[50] Philip Morris Ltd v Commissioner of Business Franchises (1989) 63 ALJR
520 at 554 (McHugh J).

[51] HC Sleigh Ltd v South Australia (1977) 136 CLR 475; 12 ALR 449.

[52] Evda Nominees Pty Ltd v Victoria (1983) 151 CLR 599; Philip Morris.

[53] Philip Morris Ltd v Commissioner of Business Franchises (1989) 63 ALJR
520 at 530 (Mason CJ & Deane J).

[54] 30 June 1975 to 24 September 1975.

[55] Cf Dennis Hotels - 12 month prior reference period ending a maximum of
12 months before a 12 months licence; Dickenson's Arcade - 12 months prior
reference period ending 6 months before a 12 months licence.

[56] The possible consequences were discussed in Capital Duplicators v ACT
[No. 2] (1993) 118 ALR 1 at 14, per Mason CJ, Brennan, Deane, and McHugh
JJ, citing Evda Nominees Pty Ltd v Victoria (1984) 154 CLR 311 [52 ALR
401], and Philip Morris (1989) 167 CLR, at 438, 443, 489-90.

[57] Caleo, C . "Section 90 and Excise Duties : A Crisis of Interpretation"
(1987) 16 MULR 296, at 309.

[58] Constitutional Commission (1988) at 828.

[59] Constitutional Commission (1988), at 822.

[60] See chapter 9 of this publication.

[61] Constitutional Commission (1988), at 824

[62] Such a fact situation might arise in an imminent challenge to the
validity of the Business Franchise Licences (Petroleum Products) Act 1987
(NSW). Arafura Transport Pty Ltd v NSW is currently filed with the High
Court. However, with no dates have been set for argument.

[63] Legislation might be drafted in exact conformity with that in H C
Sleigh. However, even if the approach of the majority in Capital
Duplicators [No. 2] is accepted, there is doubt as to the validity of such
legislation. See Capital Duplicators v ACT [No. 2] (1993) 118 ALR 1 at
13-15.

[64] "The Necessity of Amending Section 90 of the Constitution" Australian
Law Journal 57 (11) November 1983 : 599, at 600.

[65] The Report of the Royal Commission on the Constitution (1929) at 260.
i.e recommending a return to the original 1891 draft bill.

[66] The Fiscal Powers Sub-Committee Report to the Australian Constitutional
Convention (1985), at 202.

[67] Constitutional Commission (1988), at 757.

[68] This is to be achieved by an alteration to s.91 of the Constitution. See
Constitutional Commission (1988), at 829.

[69] It is not necessary to labour the barriers that make constitutional
amendment an arduous task in Australia.

[70] Hematite Petroleum Pty Ltd v Victoria (1983) 151 CLR 599 at 649, 666.
Deane J was similarly conclusive.

[71] Opeskin, B. "Section 90 of the Constitution and the Problem of
Precedent" Fed Law Review (16) 1986-1987: 170, at 177.

[72] Hematite Petroleum Pty Ltd v Victoria (1983) 151 CLR 599 at 649.

[73] Opeskin, B. "Section 90 of the Constitution and the Problem of
Precedent" Fed Law Review (16) 1986-1987: 170, at 177. A law discriminates
or gives preference to a State(s) when it provides a different rule for
different parts of Australia. On the other hand, if the law contains a
uniform rule whose effect or operation differ throughout Australia it is
not discriminatory. See James v Commonwealth (1928) 41 CLR 442 and Elliot v
Commonwealth (1935) 54 CLR 657. An example would be if the Commonwealth
imposed an excise duty on the production of widgets in all States except
W.A. This would give Western Australia a tangible commercial advantage and
would be classified as a law which gives preference to Western Australia or
discriminates against the remaining States.

[74] Opeskin, B. "Section 90 of the Constitution and the Problem of
Precedent" Fed Law Review (16) 1986-1987: 170, at 177. See also Melbourne
Corporation v The Commonwealth (1947) 74 CLR 31; Queensland Electricity
Commission v The Commonwealth (1985) 61 ALR 1.

[75] Opeskin, B. supra note 65 at 177.

[76] South Australia v The Commonwealth (1942) 65 CLR 373, at 416 per Latham
CJ; Victoria v Commonwealth (1957) 99 CLR 575,at 614 per Dixon CJ and at
657 per Fullagar J.

[77] Constitutional Commission (1988) at 827. The Commonwealth has sufficient
federal financial controls and influence such as with respect to State
borrowing, budgets, banking, overseas trade and financial transactions
which ensure that State revenue laws will not impede Commonwealth policy.