State Chamber of Commerce & Industry v Commonwealth [1987] HCA 38

State Chamber of Commerce & Industry v Commonwealth [1987] HCA 38

The Fringe Benefits Tax Act 1986 (Cth) and related Acts impose a tax upon a single subject—fringe benefits as broadly defined—not multiple subjects of taxation, and so do not infringe s 55 of the Constitution. The laws are laws with respect to taxation under s 51(ii), and are not rendered invalid by any alleged lack of real connection between subject and object. The Acts do not discriminate against States or infringe the implied constitutional principle protecting State instrumentalities or the capacity of States to function, as they apply generally to all employers including States, except that the inclusion of members of State Parliament as 'employees' for the purposes of the tax is...

Jurisdiction
Australia
Procedural Posture
Special Case/stated Case / Final Judgment
Outcome
Application dismissed. Acts valid, subject to severance as to members of State Parliaments. Plaintiffs to pay defendant's costs.
Legal Topics
['fringe Benefits Tax' 'section 55 of the Constitution' 'section 51(ii) Taxation Power' 'state Immunity From Taxation' 'discrimination Against States' 'acquisition of Property—just Terms' 'incidental/implied Powers']
['constitutional Law' 'tax Law' 'federal State Relations'] ['fringe Benefits Tax' 'section 55 of the Constitution' 'section 51(ii) Taxation Power' 'state Immunity From Taxation' 'discrimination Against States' 'acquisition of Property—just Terms' 'incidental/implied Powers']

Case Brief

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Procedural Posture

Special Case/stated Case / Final Judgment

Legal Issues

  1. 1 ['Whether the Fringe Benefits Tax Act 1986 (Cth), Fringe Benefits Tax Assessment Act 1986 (Cth), and Fringe Benefits Tax (Application to the Commonwealth) Act 1986 are invalid for dealing with more than one subject of taxation contrary to s 55 of the Constitution; for not being laws with respect to taxation or any other head of Commonwealth legislative power; or for constituting an unconstitutional acquisition of property;' 'Whether these Acts operate as an indivisible scheme so that invalidity of one renders the others invalid;' 'Whether the Acts discriminate against the States or curtail their continued existence and capacity to function as independent entities;' 'Whether the Application Act may be supported as an exercise of any Commonwealth legislative power, express or implied, and, if invalid, whether this affects the validity of the other Acts.']

Ratio Decidendi

The Fringe Benefits Tax Act 1986 (Cth) and related Acts impose a tax upon a single subject—fringe benefits as broadly defined—not multiple subjects of taxation, and so do not infringe s 55 of the Constitution. The laws are laws with respect to taxation under s 51(ii), and are not rendered invalid by any alleged lack of real connection between subject and object. The Acts do not discriminate against States or infringe the implied constitutional principle protecting State instrumentalities or the capacity of States to function, as they apply generally to all employers including States, except that the inclusion of members of State Parliament as 'employees' for the purposes of the tax is...

Court Disposition

Application dismissed. Acts valid, subject to severance as to members of State Parliaments. Plaintiffs to pay defendant's costs.

Orders

  • ['The Tax Act and Assessment Act are valid; except, per Brennan and Deane JJ, insofar as they impose tax in respect of benefits provided to State parliamentarians (and, by Brennan J, potentially to State ministers and judges), which is severed from the Act.' 'The Application Act is valid.' "The plaintiffs pay the...