The Assistant Secretary to the Department of the Treasury has forwarded for advice a letter from the Governor of the Commonwealth Bank in the following terms:

In connection with the property in Collins Street, Melbourne, known as the Old Exchange, and which has recently been purchased by the Commonwealth Bank of Australia, we have now received from the vendors a Land Tax Notice under the State Land Tax Act, with the request that the Bank should execute the document. As we hold that the Commonwealth Bank is exempt from State taxes, we shall be glad if you will please ask the Attorney-General's Department whether the Bank would incur any liability by signing the Notice.

The form of acknowledgment which is desired to be given by the Commonwealth Bank is as follows:

The Commonwealth Bank of Australia hereby acknowledge that it is now the owner of the said land within the meaning of the Land Tax Act 1915 of the Parliament of Victoria and that the statements made above are true and correct. Signed by the Manager of the Commonwealth Bank of Australia at Melbourne this day of September 1919, before me-

Witness.

Sub-section (1) of section 52 of the Land Tax Act 1915 of Victoria provides that where a person liable to land tax parts with his interest in the land his liability to land tax shall continue until he has forwarded to the Commissioner a notice in the prescribed form signed by himself accompanied by an acknowledgment in the prescribed form signed by the person to whom he has transferred his interest.

Sub-section (2) of that section requires the notice and acknowledgment to be signed in the presence of certain specified witnesses.

Sub-section (3) of that section provides that the Commissioner may, upon receiving any such acknowledgment, enter the name of the person signing the same upon the roll of taxpayers.

Section 53 of the Act provides a penalty for refusal to sign the prescribed acknowledgment.

The Commonwealth Bank being an instrumentality of the Commonwealth, there is clearly, in my opinion, no obligation on the Bank under the Land Tax Act 1915 of Victoria to sign the acknowledgment in question (D'Emden v. Pedder 1 C.L.R. 91).

If, however, the Commonwealth Bank does sign the form of acknowledgment- and that appears to be necessary in order that the vendor may be freed from liability to pay land tax-the Commissioner may apparently exercise his power under section 52 (3) of the State Act and place the Commonwealth Bank on the taxpayers' roll, but that action alone would not, I think, impose any liability on the Commonwealth Bank to pay land tax under the State Act. In other words, the Commonwealth Bank could still rely on its exemption as a Commonwealth instrumentality.

I am, therefore, of opinion that the Commonwealth Bank would not incur any liability by signing the form of acknowledgment.

As, however, it might possibly be contended by the State Land Tax authorities that such an acknowledgment was an admission that the Bank was liable as a taxpayer, I suggest that if the Bank signs the form, it should add, at the foot thereof, the words: 'This acknowledgment is not to be construed as an admission by the Commonwealth Bank of any liability to taxation by any authority of the State'.

[Vol. 16, p. 401]