The question is:

Where excise is paid, before the uniform tariff, on spirits made in Victoria, and after the uniform tariff the goods pass into New South Wales for consumption, to which State should the duty be credited?

The answer depends upon the construction of sections 89 and 93 of the Constitution. The words of those sections which are material to this question are:

Until the imposition of uniform duties of customs the Commonwealth shall credit to each State the revenues collected therein by the Commonwealth.

. . . after the imposition of uniform duties of customs . . . the duties of excise paid on goods produced or manufactured in a State and afterwards passing into another State for consumption shall be taken to have been collected not in the former but in the latter State.

Before the imposition of uniform duties, the adjustment with respect to the State of consumption was unnecessary, because the interstate customs duties prevented a large interstate traffic. But after the imposition, all obstacles to interstate traffic are removed, and on the assumption that the duty is in effect paid by the consumer the adjustment becomes necessary. On that assumption, the adjustment in section 93 is equally necessary whether the excise was paid before or after the imposition of uniform duties. The intention of the section favours the construction that the adjustment is to be made where the duty was collected before the imposition if the goods pass to another State after the imposition.

The words of section 93 seem to bear out this view. The section is not expressly limited to duties paid 'after the imposition of uniform duties', and I am of opinion that they should be interpreted to include duties paid before that time. That is to say, the revenue in the case submitted should be credited to New South Wales.⁽¹⁾

[Vol. 1, p. 119]

(1) This opinion was published in Commonwealth of Australia, Pari. Papers 1903, Vol. II, p. 936.