For us the importance of this distinction is that, because it has a place in the constitutional law of Canada, it has had to be defined and applied by the Privy Council. The Privy Council has recognized that the distinction is derived from John Stuart Mill (Bank of Toronto v. Lambe [1] ; Brewers and Maltsters' Association of Ontario v. Attorney-General for Ontario [2] ). As their Lordships pointed out in Atlantic Smoke Shops Limited v. Conlon [3] , Mill's fame as an economist was established at the time the British North America Act was passed; so that for the purpose of construing the expressions direct and indirect taxation in that instrument the use of his exposition is fully justified. But our Constitution does not make this distinction, and in Matthews v. Chicory Marketing Board [4] , Starke J. went so far as to say: "The cases under the Canadian Constitution are descriptive rather than definitive of a customs and an excise duty, and they are no authority for the proposition that a tax cannot be an excise duty unless it has the characteristics of an indirect tax" [5] . Nevertheless from Peterswald v. Bartley [6] to Browns Transport Pty. Ltd. v. Kropp, [7] this Court has considered the economic concept of indirect taxation of assistance in determining whether or not a particular impost is an excise within s. 90. But we ought not to take too much from Lord Hobhouse's reference to a duty which "enters at once into the price of the taxed commodity" [8] ; for whether a duty does enter at once into the price of the taxed commodity and in what sense, to what extent and for how long it does so, must depend upon how far various factors and circumstances remain unchanged and on the relative elasticity of demand and supply. The matter may be put in its simplest form by quoting further from the abovementioned article by Lord Stamp: "The distinction (i.e. between direct and indirect taxation) has little actual economic basis, because the effect of the tax in retarding production or consumption may be such as to throw the burden elsewhere, and the customer may, in consequence of the higher price, drink less beer, and the brewer, through selling less, make lower profits". Searching for the incidence and ultimate effect of a particular commodity tax may not be a fruitful economic inquiry. But that a tax on commodities levied on anyone before the ultimate consumer does ordinarily affect the price the ultimate consumer pays seems indisputable. If one assumes a state of perfect competition, inelastic demand and supply and other factors constant - an economist's dream world - then, as I understand the matter, the tax might be said in a simple sense to enter at once into the price. Those conditions do not, of course, prevail in the present case. But, in so far as the quality of an indirect tax is a characteristic of an excise duty, I can see no reason for thinking that the fee for a victualler's licence does not have it. It was argued that, because the levy is payable when a licence is renewed and is calculated in respect of purchases for a previous period, it does not enter into the price of the actual commodities sold during the period for which the licence was renewed. A hypothetical illustration in the judgment of Dixon J., as he then was, in Parton v. Milk Board (Vict.) [1] , supports this view. But, as his Honour does not now regard it as correct, it may be put aside and the question approached afresh. The real nature of the tax has to be ascertained (see per Starke J. in Matthews v. Chicory Marketing Board (Vict.) [2] ). This depends upon its operation and effect upon the commodity as an article of commerce. The mechanics of calculating and collecting it should, in my view, be considered so far only as they substantially affect its operation and commercial effect. That a tax is computed in respect of a trader's purchases in a particular period and is payable when he renews his annual trading licence for a different period cannot, I think, be decisive in itself. If it is, then, as my brother Menzies has pointed out, the logical consequence is that whereas the fee paid for a victualler's licence is not a duty of excise, that paid for a temporary licence is. But the two imposts are similar in their general economic consequences. To distinguish them in the way that the logical application of the proposed criterion demands appears to me to involve considerations so nice as to be artificial. Moreover, with great respect to those who think otherwise, it seems to me that this ground for denying the character of an excise to the victualler's licence fee overlooks the way in which a publican's business is conducted. A victualler's licence authorizes the holder to sell liquor upon the licensed premises. The term "victualler" in this connexion has for long been restricted to publicans, that is to "persons authorized by law to keep houses of entertainment for the public" (per Tindal C.J. in Tyson v. Smith [3] ). The Licensing Act requires a licensed victualler to provide meals and accommodation on the premises - in effect to keep an inn. But his licence merely authorizes him to sell and dispose of liquor in any quantity on the premises therein specified between the hours of nine in the morning and six in the evening (s. 8). The right (more strictly the immunity or privilege) which the licence thus creates arises because it is an offence to sell liquor without a licence (s. 154). The licence is granted for a year. It is renewable from year to year. Renewals are obtainable under s. 88 of the Act at the annual sitting of the Licensing Court which is held during such periods in every year as are appointed by notice in the Gazette (s. 80 (1)). Applications for renewal have to be made before the first day of the annual sittings; but apparently they may be made at any time before that day (s. 88). Technically, a renewal is not a continuance of the old licence, but a re-granting of a new licence. A licensee is, however, entitled, subject to objection, to obtain a renewal provided the licence was not liable to be forfeited or revoked (s. 88). (See per Jordan C.J. in Ex parte James; Re Furlong [1] ). It is important to note that the Victorian Act here differs materially from the law under consideration in Sharpe v. Wakefield [2] . (See also Reg. v. Flintshire County Council County Licensing (Stage Plays) Committee; Ex parte Barrett [3] ). A publican who carries on his business in a proper fashion can therefore expect to have his licence renewed from year to year. This is what the Act contemplates (see per Lord Bramwell in Sharpe v. Wakefield [4] ). A publican's business is thus normally conducted on the basis that it will continue. Liquor stocks are replenished as the need arises and sold as demanded. The course of trading is not broken into annual periods. How much, if any, of the liquor bought in the period in respect of which the tax is computed is in stock when the tax has to be paid depends upon the course of trading. A victualler's licence relates to particular premises. It can in certain circumstances be removed to new premises (s. 120). The Act itself indicates what common knowledge makes plain, namely that a licence annexed to premises is a valuable thing. There are careful provisions to safeguard the interest of the owner or mortgagee of the premises if the licensee should fail to apply for a renewal of his licence or should cause it to be forfeited (ss. 89, 115). The owner or mortgagee can then obtain a renewal. If he does so he must pay the tax computed on the purchases made by the outgoing licensee. The tax is payable when any person applies for and gets either the grant or renewal of a victualler's licence. It is not computed on the value of the applicant's purchases - it could not be in cases when he had not previously been the licensee of the premises, and was thus applying for a grant as distinct from a renewal. It is computed on the amount paid or payable for liquor which had been purchased for the premises. The result is that, assuming the law is not altered, and assuming the premises remain licensed, a tax of six per cent must be paid upon the amount of all liquor from time to time bought for the premises, no matter when it be bought and no matter when, or by whom, or indeed where, it be sold. From a business point of view that must mean that the surcharge which the law has imposed on the cost of the liquor will, to a greater or less amount, be reflected in the price at which it is sold to the consumer. I say to a greater or less amount, because this qualification must, as I have said, always be made when the circumstances are not those of perfect competition and inelastic demand and supply. In the case of the liquor trade, the need for the qualification is very obvious. The circumstances are complex. The tax is by law apportionable between the holder of the licence and the owner of the licensed premises (s. 19 (3)). That would not prevent it being, in part at all events, passed on. Moreover, this tax has been long in operation, and there is an adage that an old tax is no tax. There is usually some measure of uniformity in the retail prices of some forms of liquor. The trade as a whole is carried on in conditions of partial monopoly. And, as was pointed out, it cannot be supposed that the retail prices of all types, qualities and quantities of liquor will reflect the burden rateably. But a commodity tax certainly does not cease to be an indirect tax, so far as that is an element in the concept of excise, because the precise extent to which the burden is "passed on" is not predictable and is not uniformly discernible in each item of the commodity sold.