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[1969] HCA 42
High Court of Australia
1969-07-01
Owen JJ, McTiernan J, Kitto J, Menzies J, Windeyer J
Original judgment source is linked above.
These proceedings by way of originating summons which were instituted in the Supreme Court of Western Australia were removed into this Court under s. 40A of the Judiciary Act.
The facts are that the defendant, a company incorporated in Victoria and registered in Western Australia as a foreign company, was at all material times carrying on in Western Australia the business of mining and selling iron ore. In the course of that business it sold and delivered ore mined by it to Japanese buyers under f.o.b. contracts providing for shipment from a Western Australian port. Payment of the price of the ore thus sold was made by the buyers to the defendant at places outside the State of Western Australia.
In January 1967 the defendant gave notice in writing under s. 99A (1) of the Stamp Act of Western Australia electing to pay duty under that section instead of under s. 99A (2) of the Act, and from 1st February 1967 until 16th October 1967, when it cancelled that notice, it made returns under s. 99A (1). It did not include in those returns the amounts received by it outside the State of Western Australia in payment of the price of the ore supplied by it under the contracts to which I have referred earlier. In respect of such payments it caused receipts or notes or memoranda acknowledging the receipt of the payments to be issued to the buyers of the ore but such receipts, notes or memoranda have not been brought into Western Australia and no duty under the Act has been paid upon them.
The questions that arise relate to s. 101A of the Act and one of them (question C) asks whether any stamp duty which might otherwise be payable by the defendant under that section in respect of payments received by it outside Western Australia in payment of the price of the iron ore supplied and sold by it is a duty of excise within the meaning of s. 90 of the Commonwealth Constitution. Another question (question B) asks, in substance, whether, apart from the matter raised by question C, s. 101A is beyond the legislative power of the Parliament of Western Australia. As to this last question I have no doubt that the answer should be "No" and I do not wish to add anything to the reasons given by the Chief Justice and by Kitto J. in the judgments which have just been delivered.
The problem raised by question C is, however, one which has troubled me greatly.
Section 101A deals (inter alia) with cases in which goods have been supplied in Western Australia by a person in that State and payment for such goods has been received or made outside the State. In such cases the payment is to be deemed to have been received by or made to the person who has supplied the goods provided, as I read the section, that he is in Western Australia at the time of the receipt. In such case he is required within thirty-one days of the payment being received or made to issue or cause to be issued in Western Australia to the person who made the payment, a note or memorandum acknowledging the amount of the payment, stamped with duty in accordance with the Act, as if it were a receipt.
There is no doubt that the duty imposed is a tax, the amount of which is measured by the amount received. For the defendant it is contended that the tax which s. 101A, when read with the other provisions of the Act and the Second Schedule, imposes is, in some but not in all circumstances, a duty of excise because, it is said, in a case such as the present one, the tax is imposed upon a step taken by the producer of a commodity in the course of putting that commodity into consumption. That step, it is said, consists of the supply of his product by its producer to a buyer and the receipt by the former of the price. It is rightly conceded that there are many kinds of transactions falling within the words of the section in which it could not be said that the impost would constitute a duty of excise. But that does not, I think, provide an answer to the defendant's contention that, as applied to transactions of which the present case is an example, the impost is in truth a duty of excise. I can see no good reason why a law imposing a tax in general terms which would apply to a wide range of transactions should not, in respect of some only of those transactions, be a duty of excise while it could not be regarded as being such a duty in respect of others.
I have come to the conclusion that the defendant's submission should be upheld and that the tax which would otherwise be imposed upon the defendant by virtue of the provisions of s. 101A is a duty of excise. The defendant's liability to tax is attracted by the existence of two facts. The first is that, having produced a commodity, namely iron ore, in Western Australia, it has there supplied it to a buyer under a contract of sale, the second is that it has received payment outside Western Australia for selling and supplying that commodity. It seems to me that to impose a tax, in the nature of an ad valorem tax, upon the receipt of the price of the commodity produced and sold by it imposes a burden upon a dealing with the commodity in the course of its progress from production to consumption. If that is so, then, as was said by Rich and Williams JJ. in Parton's Case [1] , the imposition is to be regarded as a method of taxing the production of that commodity. To the same effect is a passage in the judgment of Dixon J. (as he then was) in the same case. His Honour said, "a tax upon a commodity at any point in the course of distribution before it reaches the consumer produces the same effect as a tax upon its manufacture or production" [2] . To impose a tax upon the receipt of the price for which a commodity is sold by its producer is, in my opinion, to tax a dealing with the commodity and such a tax is in reality a sales tax notwithstanding the fact that it takes the form of a duty upon an instrument which the recipient of the price of the commodity is required to bring into existence.
Western Australia
Hamersley Iron Pty Ltd
High Court of Australia Barwick C.J. McTiernan, Kitto, Taylor, Menzies, Windeyer and Owen JJ. Western Australia v Hamersley Iron Pty Ltd [No 1] [1969] HCA 42