It should be noted that the name of this Bill
as introduced on 22 October 2009 is actually the
Carbon Pollution Reduction Scheme (Charges Excise) Bill
2009. This Bill is identical to the earlier Bill
of the same name which was first introduced in the House of
Representatives on 14 May 2009, passed unamended on 4 June 2009,
but then negatived by the Senate on 13 August 2009.
The addition of the
reference [No. 2] has been made by the Department of the House of
Representatives Table Office to indicate that the Bill is
introduced for a second time.
Bills Digest no. 54 2009–10
Carbon Pollution Reduction Scheme (Charges Excise) Bill
2009 [No. 2]
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
consulted to determine the subsequent official status of the
Contact officer & copyright details
introduced: 22 October
House: House of Representatives
Portfolio: Climate Change and Water
The formal provisions
(sections 1 and 2) will commence on the day of Royal Assent. The
main operative provisions (sections 3 to 8) will commence at the
same time as the operative provisions of the Carbon Pollution
Reduction Scheme Act 2009 commence.
relevant links to the Bill, Explanatory Memorandum and second
reading speech can be accessed via BillsNet, which is at http://www.aph.gov.au/bills/.
When Bills have been passed they can be found at ComLaw, which is
To safeguard the constitutional validity of the proposed
Carbon Pollution Reduction Scheme Act 2009 in respect of
the levying of charges for the issue of Australian emissions
of the Carbon Pollution Reduction Scheme Bills and this Digest
The Carbon Pollution Reduction Scheme (Charges Excise) Bill 2009
(the original Bill) was first introduced into Parliament on 14 May
2009 as part of the 11-Bill Carbon Pollution Reduction Scheme
(CPRS) package of legislation. Along with the other CPRS Bills, the
original Bill was passed by the House of Representatives on 4 June,
but negatived in the Senate on 13 August 2009.
The content of the current Bill, the Carbon Pollution Reduction
Scheme (Charges Excise) Bill 2009 [No. 2], is identical to the
original Bill. As such, this Digest is unchanged from the Digest
produced in June 2009 for the original Bill. For commentary on
recent developments regarding the proposed CPRS, including the
reintroduction of the CPRS Bills, see relevant sections in the
Digest on the Carbon Pollution Reduction Scheme Bill [No. 2]
At the time of writing, the
current Bill has not been referred to any committee. The original
Bill, along with the others in the CPRS package, was referred to
the Senate Standing Committee on Economics for inquiry and report
by 15 June 2009. Details of the inquiry are at
Section 55 of the Commonwealth Constitution states:
Laws imposing taxation shall deal only with the
imposition of taxation, and any provision therein dealing with any
other matter shall be of no effect.
Laws imposing taxation, except laws imposing
duties of customs or of excise, shall deal with one subject of
taxation only; but laws imposing duties of customs shall deal with
duties of customs only, and laws imposing duties of excise shall
deal with duties of excise only.
In Australia, the classic formulation of what is a tax was set
down some 70 years ago by Latham CJ of the High Court of
[a tax] is a compulsory acquisition of money by
a public authority for public purposes, enforceable by law, and is
not a fee for services rendered.
This formulation is not necessarily a legally exhaustive test of
whether in all circumstances a charge is a tax, but as a broad
guide it remains valid.
Part 4 of Division 2 of the Carbon Pollution Reduction Scheme
Bill 2009 Bill [No. 2] (the primary Bill) provides that a charge
may be payable to the Commonwealth for the issue of an Australian
emissions unit. The Government has stated that it does not consider
such a charge is a tax within the meaning of the Constitution, and
thus the primary Bill does not impose a tax. However, to avoid any risk of a
contravention of the first paragraph of section 55 above, it has
introduced three separate Bills, along with inserting clause 91 in
the primary Bill.
Clause 91 in the primary Bill provides that if the charge for
the issue of an Australian emissions unit is in fact a tax, then
the charge is not imposed by the primary Bill, but whichever of the
following three Acts are relevant in the circumstances:
- the Carbon Pollution Reduction Scheme (Charges Customs) Act
- the Carbon Pollution Reduction Scheme (Charges Excise) Act
- the Carbon Pollution Reduction Scheme (Charges General) Act
This approach avoids any possibility of the non-taxation
elements of the primary Bill being of no effect under section 55 of
the Constitution. It then safeguards the validity of the primary
Bill, and hence the legislative underpinning of the CPRS.
Clause 4 provides that the State, Territory and
Norfolk Island governments are bound by the Bill, but the
Commonwealth is not. It is unclear why the Bill has been drafted to
exempt the Commonwealth, and neither the second reading speech nor
the Explanatory Memorandum sheds any light on this.
Clauses 5-6A deal with the geographical
coverage of the Bill. It applies in all Australian external
territories, the exclusive economic zone and continental shelf, and
the Timor Sea Joint Petroleum Development Area.
Clause 7 states that if a charge is payable to
the Commonwealth for the issue of an Australian emissions unit,
whether as result of an auction or by a fixed charge, and that
charge is taxation within the meaning of section 55 of the
Constitution, then the charge is imposed by clause 7, so far as the
charge is an excise duty (within the meaning of section 55).
Clause 8 provides that the Bill cannot impose a
tax upon property of any kind belonging to a State. This is to
ensure that the Bill does not contravene section 114 of the
Constitution, which prevents the Commonwealth and the States from
taxing each other s property.
Copyright Commonwealth of Australia
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29 October 2009
Bills Digest Service
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