Bills Digest no. 150 2008–09
Carbon Pollution Reduction Scheme (Charges Customs) Bill
2009
WARNING:
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
Bill.
CONTENTS
Passage history
Purpose
Background
Main provisions
Contact officer & copyright details
Passage history
Date
introduced: 14 May
2009
House: House of Representatives
Portfolio: Climate Change and Water
Commencement:
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.[1]
Links: The
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
at http://www.comlaw.gov.au/.
To safeguard the constitutional validity of the Carbon Pollution
Reduction Scheme Bill 2009 in respect of the levying of charges for
the issue of Australian emissions units.
Background
Under the Carbon Pollution Reduction Scheme (CPRS), charges may
be payable to the Commonwealth by a person who is issued with an
Australian emissions unit, either as a result of the unit being
auctioned by the Commonwealth, or the Commonwealth selling it at a
fixed price.
Background on the issuing of Australian emissions units can be
found in the Bills Digest on the Carbon Pollution Reduction Scheme
Bill 2009 (the primary Bill).
The Bill, along with the
others in the CPRS package, has been referred to the Senate
Standing Committee on Economics for inquiry and report by 15 June
2009. Details of the inquiry are at
http://www.aph.gov.au/senate/committee/economics_ctte/cprs_2_09/index.htm
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
Australia:
[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.[2]
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 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.[3] 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
2009
- the Carbon Pollution Reduction Scheme (Charges Excise) Act
2009
- the Carbon Pollution Reduction Scheme (Charges General) Act
2009
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 a customs 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.
Members, Senators and Parliamentary staff can obtain further
information from the Parliamentary Library on (02) 6277
2764.
Angus Martyn
2 June 2009
Bills Digest Service
Parliamentary Library
© Commonwealth of Australia
This work is copyright. Except to the extent of uses permitted
by the Copyright Act 1968, no person may reproduce or transmit any
part of this work by any process without the prior written consent
of the Parliamentary Librarian. This requirement does not apply to
members of the Parliament of Australia acting in the course of
their official duties.
This work has been prepared to support the work of the Australian
Parliament using information available at the time of production.
The views expressed do not reflect an official position of the
Parliamentary Library, nor do they constitute professional legal
opinion.
Feedback is welcome and may be provided to: web.library@aph.gov.au. Any
concerns or complaints should be directed to the Parliamentary
Librarian. Parliamentary Library staff are available to discuss the
contents of publications with Senators and Members and their staff.
To access this service, clients may contact the author or the
Library’s Central Entry Point for referral.
Back to top