Opinion No. 10
IMPOSITION OF UNIFORM DUTIES OF CUSTOMS
WHETHER EXECUTIVE ACT OR RESOLUTION OF HOUSE OF REPRESENTATIVES SUFFICIENT OR ACT OF PARLIAMENT NECESSARY : EFFECT ON STATE TARIFFS OF COLLECTION OF DUTIES PURSUANT TO RESOLUTION : RETROSPECTIVE LEGISLATION
CONSTITUTION, ss. 88, 89, 90, 92, 93, 94, 95
21 August 1901
- Is the collection of duties, upon a resolution of the House on the day of the introduction of the tariff, 'the imposition of uniform duties of customs' within the meaning of sections 88, 89, 90, 92, 93, 94 and 95?
The real question is whether imposition within the meaning of these sections dates from the imposition by the authority of law, or from the prior collection of duties, without legal authority, but according to a recognised usage, for the protection of the revenue. For answer to this question we must look-
- to precedents and authority;
- to the intention of the Constitution.
'Impose' means 'to lay or place, as something to be borne or endured; to levy or exact as by authority; as to impose a tax, toll, or penalty': Standard Dictionary. 'Imposition' means 'the act of imposing'; or, in a secondary sense, 'that which is imposed or laid on by authority, as a tax, toll, or duty' (ibid.).
Before the parliamentary control of taxation was fully established, when the King wanted money in excess of the ordinary revenue he could obtain it either by direct taxation on lands or chattels, or by indirect taxation in the form of impositions on exports and imports: Anson, Law of the Constitution, I, p. 306, and Case of Impositions(1) there cited. Impositions without parliamentary authority were abolished in 1640 by the Act 16 Car. I c. 8, which declared it to be an ancient right of the subjects that no subsidy, custom, impost, or charge may be laid or imposed upon merchandise exported or imported without common consent in Parliament.
In English and Colonial tariff legislation, the word 'impose' is not commonly used. A proposal to levy customs duties is introduced by a resolution submitted to the House that there shall be 'raised, levied, collected and paid to His Majesty', from the date of the resolution upon the importation of goods, duties at the rates specified. On this resolution, the Government at once collects duties at the proposed rates where they are higher than those then existing. A Bill founded on this resolution is then introduced and passed; and usually declares the operation of the Act to have commenced on the date of the resolution. See May, Parliamentary Practice, p. 556; New South Wales Customs Duties Act of 1884; Victorian Customs and Excise Duties Act 1895; Queensland Customs Duties Act of 1870.
Pending the passing of the Act, the collection of duties in pursuance of the resolution is not authorised by law, and an action will lie for the recovery of the duties paid: Stevenson v. The Queen 2 W.W. & A'B. 143. But such collection being a recognised constitutional practice for the protection of the revenue, the Court in the exercise of its discretion, will refuse to grant a mandamus to compel the Collector to sign bills of entry without payment of the duties: Ex parte Wallace & Co. 13 N.S.W. L.R. 1.
The passing of the Act in the form mentioned validates the collection, so far as it was in accord with the Act as finally passed; and any duties collected from the date of the resolution, in excess of the rates prescribed by the Act, are refunded.
In the United States (where Congress is prohibited from passing ex post facto laws) the new duties are not collected until the Act is passed.
The Queensland Customs Duties Act o/1870 (sections 3 and 4) contains provisions for estimating the value of goods in all cases where an ad valorem duty 'is imposed'.
These authorities do not carry us very far in the interpretation of the word 'imposition' in the Constitution; but so far as they go they seem to point to the view that 'imposition' means imposition by the authority of law.
For the interpretation of the word 'imposition' in the Constitution, the first and surest test is to ascertain, if possible, the intention of the Constitution as gathered from a comparison of its provisions as a whole. Section 88 provides that uniform duties of customs 'shall be imposed' within two years after the establishment of the Commonwealth. Section 89 prescribes the mode of distributing revenue 'until the imposition of uniform duties of customs'. Section 90 provides that 'on the imposition of uniform duties of customs' the power of the Parliament to impose uniform duties of customs and of excise shall become exclusive, and State laws imposing such duties shall cease to have effect. Section 92 provides that 'on the imposition of uniform duties of customs', interstate trade shall become absolutely free. Section 93 provides for a modified mode of distributing revenue 'during the first five years after the imposition of uniform duties of customs, and thereafter until the Parliament otherwise provides'. Section 94 empowers the Parliament, 'after five years from the imposition of uniform duties of customs' to provide for the distribution of surplus revenue to the States on such basis as it deems fair. And section 95 empowers the Parliament of the State of Western Australia 'during the first five years after the imposition of uniform duties of customs', to impose customs duties, on a diminishing scale, on goods imported into that State from other parts of the Commonwealth.
The provisions of the Constitution as to the imposition of uniform customs duties may therefore be summarised and arranged as follows:
- Time of imposition: must be within two years from the establishment of the Commonwealth.
- Effects of imposition:
- Interstate trade becomes free.
- Power of Parliament to impose customs and excise duties becomes exclusive.
- State laws imposing customs and excise duties cease to have effect.
- Imposition is the reckoning point for:
- The termination of the preliminary mode of distributing revenue.
- The commencement of the five year period of distribution.
- The commencement of the power of the Parliament to alter the mode of distribution.
- The reduction and ultimate extinction of the power of Western Australia to impose interstate duties.
Section 88 ('Uniform duties of customs shall be imposed') makes no express reference to the Parliament. But section 90 provides that on the imposition 'the power of the Parliament to impose duties of customs and of excise' shall become exclusive; and that 'laws of States [sic] imposing duties of customs or of excise' shall cease to have effect. Section 95 empowers 'the Parliament of the State of Western Australia' to impose duties of customs for a limited time. These provisions strengthen the view that 'imposition', throughout the Constitution, means imposition by law.
It may be gathered from the Constitution that the intention was to direct the establishment of a uniform tariff as soon as possible after the establishment of the Commonwealth. Two years is not an unreasonable maximum limit for the passing of a tariff by the Parliament; but it is excessive for the framing and introduction of a tariff by the Government. It is not to be presumed that the provisions of section 90, which operate on State laws and powers, by annulling State laws imposing customs, and de-priving the States of all power to legislate on those subjects, were intended to be brought into force by a mere act of the Executive, or anything less formal than a law of the Federal Parliament.
The possible failure of the Federal Parliament to pass the first tariff Bill at all must also be taken into account as a contingency, though doubtless a remote one, because of its effect upon the States. The imposition of a uniform tariff is coincident with the lapsing of the State tariffs. But for the express words of section 90 it might be contended- and even in spite of them it may be contended-that in such a contingency the State tariffs would revive, or remain in force, until a Federal tariff did become law. But if the collection of the duties is an 'imposition', within the meaning of the Constitution, it is very doubtful if the State tariffs could revive. There is no provision for what is to happen if, after a tariff has been once 'imposed', it is cancelled or allowed to drop. The prospect thus presented shows the contention that collection is imposition to be extremely perilous to the States from a practical point of view.
Again the passing of a resolution for the levying of duties being no guarantee that a Bill founded on those resolutions will be passed, if the Bill failed to become law, the Commonwealth would pending the passing of another tariff be left without lawful means of raising revenue. This cannot have been contemplated. And in any case, it can hardly have been intended that the existing laws for raising customs revenue should be displaced until substituted laws came into force. Section 95 which prescribes a mini-mum of five years after imposition before the Federal Parliament is empowered to deal freely with the distribution of revenue, shows an intention that the Parliament shall not have that power until it has had five years experience of the working of the Federal tariff. The unsettled period between the introduction of a tariff and its passing- perhaps with material alterations-can hardly have been meant to be counted as a part of the five years./
The importance of the date of imposition, as setting the clock for the commencement of the different financial periods, indicates a formal imposition by Act of Parliament.
The combined weight of these considerations points with considerable force to the conclusion that imposition means imposition by law. But assuming that these arguments are not conclusive, and that there remains an ambiguity on the face of the Constitution, it would appear that according to some authorities the history of the Constitution, and the debates of the Conventions, may be resorted to as indicating the real intention of the framers. In the construction of Acts of Parliament in general, extrinsic evidence, such as reference to the proceedings in Parliament, is not admissible; but a Constitution, framed in constitutional convention, is an Act of a very special character; and in the United States reference has been permitted to contemporary history and the debates of constitutional conventions with a view to clearing up ambiguities: Black, Interpretation of Laws, p. 28.
Reference to the history of the Constitution strengthens materially the view already expressed. In Chapter 4 of the Commonwealth Bill of 1891, section 7 (corresponding to section 90 of the Constitution) provides that 'until uniform duties of customs have been imposed by the Parliament of the Commonwealth', State laws and powers shall continue; and section 8 (corresponding to section 88 of the Constitution) provides that 'so soon as the Parliament of the Commonwealth has imposed uniform duties of customs', interstate trade shall be free. See also Convention Debates 1891, pp. 528,790, 791,792,794, 833. There can be no doubt therefore but that the 1891 Bill contemplated that the time of the passing of an Act would mark the moment of imposition. No hint appears in the Convention Debates of 1897-98 implying any intention to make any alteration except in phrase in this respect. So serious a change would surely have been explained and debated if it had been intended or deemed possible.
In the draft of the Bill as first introduced at Adelaide in 1897, the reference to the Parliament was omitted; but it appears from the debates that 'imposition' was still understood as meaning imposition by the Parliament; see Convention Debates, Adelaide, pp. 446, 872-4, 895; but see also p. 1064.
See also Convention Debates, Sydney, pp. 143, 655; Convention Debates, Melbourne, pp. 795, 823 (where Mr Holder contemplates the probable lapse of two years before imposition), 851 (where Mr Glynn seems perhaps to have touched upon an opposite view), 938, 1009, 1011, 1012 (where Mr Reid contemplates six months for introduction, and eighteen months for discussion), 1013, 1043-4, 1103, 1131. So far as these interpretations go they all appear to assume that the intention of the Convention members was to look upon 'imposition' as only possible by an Act of the Parliament.
- Can an executive act of the Federal Government make such collection an imposition?
If the above opinion is correct, it follows that an executive act, unauthorised by law, cannot amount to 'imposition' within the meaning of the Constitution.
The Parliament may of course, following the usual English and Colonial practice, make the tariff Act operate retrospectively from the date of any resolution passed for the protection of the revenue, in which case 'imposition', with all its consequences, would relate back to that date, and all interstate duties (subject to paragraph 2 of section 92) collected since that date would have to be refunded.
The Federal Parliament is not debarred from passing restrospective legislation generally. See Lefroy, Legislative Power in Canada, xlvi-lx, and authorities cited in Quick & Garran, pp. 721-2. With respect however to this particular question, the time of 'imposition' is of such fundamental importance and is so explicitly referred to in the Constitution that it may well be that the power of the Parliament to date the imposition back is restricted. It could probably not declare any state of affairs which did not amount to an imposition in fact, to be an imposition in law; but it cannot be doubted that it has the power to declare retrospectively that the imposition in law shall, according to the usual practice, date from the imposition in fact.
- What effect will the collection of uniform duties of customs under a resolution of the House have upon the State tariffs?
All State tariffs remain in force and unaffected until repealed by an Act of the Parliament. That repeal may in that Act be dated back to the collection of the uniform duties under resolution.
In each instance the higher duty whether levied under the Federal proposals or the State tariffs will be collected and any excess over the duty authorised by the Act refunded.
[Vol. 1, p. 61 ]
(1) 2St.Tr. 371