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Legislative Assembly for the ACT: 2000 Week 6 Hansard (23 May) . . Page.. 1559 ..

MR STANHOPE (continuing):

year in relation to taxation by subordinate laws under the road transport legislation, the Minister for Urban Services replied to the committee:

He went on to say:

In other words, the minister was saying that the executive imposes taxation by regulation without reference to the Assembly. It may be that some government fees and charges, such as the motor vehicle registration fee, are invalidly made and imposed and, if challenged in the courts, it is not entirely clear whether the court would uphold them.

Members would be aware that the general approach taken by the courts has been to hold that a statutory power to impose a fee or charge by a subordinate law will be restricted to fixing an amount that is genuinely a recompense for the provision of a service rendered. This is taken to mean that the fee or charge must be closely related to the actual costs and expenses incurred when the service is provided. Anything more than the actual costs or expenses could cause the fee or charge to be regarded by the courts as a tax and invalidly imposed unless sanctioned by an act of the parliament. Rather than addressing this problem through a system of good administration whereby taxes, fees and charges are all properly distinguished, calculated and validly made, the government is going for a quick fix at the cost of the Assembly giving up its power to impose taxes through an act.

In its 1999 report, the committee stated that the general principle according to which it and other scrutiny committees operate is that it is for the parliament to set a rate of tax, not for the makers of subordinate legislation to do so. The scrutiny of bills committee pointed out the longstanding constitutional position that the raising and expenditure of public revenue have long been under the control of parliament.

The Attorney's presentation speech and explanatory memorandum are, at best, misleading. In those documents it is stated that the purpose of the amendment is to remove the theoretical possibility of a legal challenge to the validity of fees and charges, to close a gap pointed out by the scrutiny committee, and to enable the ACT to collect the GST on its fees and charges.

The difficulty with these reasons is first, as I have pointed out in relation to motor vehicle registration charges, the possibility of a challenge to the validity of fees and charges is more than theoretical. Although departmental officers say that there has never been a challenge to any ACT fee or charge on this basis, there have been challenges to commonwealth fees and charges, notably in the case of Air Caledonie International v The Commonwealth. In that case, a fee imposed by the department of immigration was declared to be a tax. The fee per person was imposed on all persons entering Australia.

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