Queensland Water and Waste Ltd - Assignment Example

Name Tutor Task Date IN THE HIGH COURT OF AUSTRALIA BRISBANE REGISTRY BETWEEN: QUEENSLAND WATER AND WASTE LTD Applicant and The state of Queensland Respondent Outline of argument for the applicant 1. This is the case between the Queensland Water and Waste Ltd (Applicant) and Queensland Parliament (Respondent). 2. According to the allegations the respondent (Queensland Parliament) invalidly enacted the Pipeline Charges Act 2010 (QLD). It is also alleged that the Act invalidly imposed a fee on the owners of Pipelines in form of tax payable to the Queensland Treasury. 3. Section 90 of the Australian constitution holds back the Australian Parliaments’ exclusive powers to impose customs and excise duties. 4. The imposition of the excise taxes is now an exclusive commonwealth power in pursuant with this section. (Hanks 207). 5. Amongst Queensland Water and Waste Ltd (QWW’s) functions is the supply of water to the residents of the Gold Coast a local government area of Australia. It also provided sewerage services to the same residents. 6. Commencing on 1 January 2011 the Pipeline Charges Act 2010 (QLD) began to impose charge on owners of Pipelines. The charge commenced at a fee of $100 per every kilometer of pipe laid on Queensland land. The fee is to be paid as a tax and submitted on 1 February every year. 7. In respect to the section 2 of Pipelines Charges Act, they are supposed to make payments to the Queensland Treasury for these pipes. 8. Commencing on 1 January 2011 the Pipeline Charges Act, QWW ltd has a liability to pay a utilities tax. The tax was charged upon the pipes which were distributing water and sewerage. Notice seeking the payments of the charges was sent to QWW and was shown as separate amounts in invoices rendered to them. 9. The application made to the High Court challenges the validity of the Queensland Act. The Queensland Water and Waste Ltd declined to make payments of fees for the water pipes and sewer pipes alleging that s 90 of the Constitution was infringed. 10. Queensland Parliament insisted that the law is an entirely valid exercise of Queensland’s constitutional power. 11. The fundamental question in the present proceedings is whether the Act’s application to the pipes infringes s 90 of the Constitution. The question aims to determine whether the law is an entirely valid exercise of Queensland’s constitutional power. The major aim is to review key decisions of the High Court regarding the interpretation of s 90. 12. Section 90 of the Constitution of the Commonwealth of Australia ("Constitution") gives the Commonwealth Parliament the exclusive power to impose duties of custom and of excise. 13. The interpretation of the section is based on the key term in the provision which is “duties of excise”. 14. In the case of Australia Capital Territory v Queanbeyan City Council [2010] FCAFC 124, an interpretation was sought to determine the scope of the Queensland Act (Hanks 207). In this case the ability of the Australian Capital Territory to levy water charges and ACTEW Corporation Ltd passing them to the customers was challenged by Queanbeyan City Council (QCC) in the Federal Court of Australia. 15. Queanbeyan City Council (QCC) filed proceedings against Australian Capital Territory (ACT) and ACTEW Corporation Ltd. They claimed that water abstraction charge (WAC) imposed by water resources Act and network facility tax were both duty of excise. 16. The judge ruled out that it was only network facility tax that was an excise duty. The court held that the character of the charges distinguished them from duties of excise. The Australia Capital Territory was allowed to enact them and ACTEW Corporation Ltd to extend them to customers. The court construed a duty of excise as a tax on goods charged on their production or distribution. (Hilliard 130). 17. Queensland Water and Waste Ltd (QWW) have declined to make payment of fees for the water pipes and sewer pipes. They can rely on the following main arguments. These include: The charges were invalid because only the Commonwealth can impose taxes (section 90 of the Constitution) The tax is a form of public utility tax beyond Queensland constitutional power The pipeline charges are discriminatory (a) The charges were invalid because only the Commonwealth can impose taxes The applicant (QWW) argued that Queensland Act is constitutionally invalid in its application to the water pipes because it infringes s 90 of the Constitution. They claimed that it was beyond the Queensland constitutional power to impose “excise duties”. Under section 90 of the Constitution only the Commonwealth can impose excise duties. The challenge that is now faced by QWW in their argument is the interpretation and explanation of the word “excise duty”. The applicant has the onus of convincing the High Court that the water and sewage passing through the pipes comprise goods that are subject to excise duty. A duty of excise is a tax levied on goods during their production or distribution. This tax has an effect of increasing the price of goods supplied to the customer or the general public. The Trade Practices Act has included water and waste water in the network services as good. Having been described as a good, the Queensland constitution has no power to levy pipeline charges. Instead the commonwealth constitution reserves this right. The High court should therefore use this argument to declare the Queensland Act as constitutionally invalid in its application to the water pipes because it infringes s 90 of the Constitution (Zines 974). (b) The tax is a form of public utility tax beyond Queensland constitutional power Public utility tax is a tax levied on public service businesses including those businesses that involve in the transportation, and supply of natural gas or water. The distributed water and waste water are therefore goods that are subject to excise duties. These charges are to be collected by the commonwealth constitution and not the state. However, the amount collected may then be distributed to the state general fund. The utilities tax imposes upon the QWW utilities by reference to the length of the water distribution network situated on the land of Queensland (Cope 1024). (c) Charges are discriminatory The Queensland Water and Waste Ltd (QWW) third argument is the claim that Pipeline Charges Act 2010 (QLD) is discriminatory. The charges invalidly discriminated against the water pipes, and would be struck down by the prevailing Commonwealth legislation. The act is alleged to impose tax on particular structures on the land of Queensland while leaving others. QWW is able to show that although the Queensland government seek to charge them, there is no attempt made to charge other structures sitting on or under Queensland. Such structures include gas pipes and the applicant believes that they should be equally charged under the Pipelines Charges Act. The laws of the Queensland state have no power to discriminate against a particular network facility. 18. This case provides an insight on the difficulty experienced by the High Court in its ruling. The major challenge is in the interpretation of the word ‘excise duty’. 19. It is only commonwealth constitution that is mandated to levy the excise duty. Pursuant to the section 90 of the commonwealth constitution, when the imposed tax will result to the increase in the price of the good distributed to the customer, this is an excise duty (Woellner 537). 20. The charge on the owners of the water pipes may force them to overcharge the customers. From the facts presented in the arguments, the Queensland constitution has no powers to impose tax on the water and sewerage pipes. This is because this is part of distributed goods that are subject to the excise duty that is exclusively reserved to the commonwealth constitutional powers. 21. In my opinion, the applicant (Queensland Water and Waste Ltd), is right in their allegations that the Queensland Act is constitutionally invalid. The applicant need not pay any fees for the water pipes and sewer pipes. 22. The fee charged is extraordinarily large in amount and have no relationship to the amount of fees payable for other pipeline. The QWW should therefore not pay for the pipeline charges despite the fact that they are licensed by the state. 23. It would also suffice to say that the duty of excise like the one discussed above should be an indirect tax. This means that it is a tax upon the water pipes and not a tax upon the pipe References: Albert Venn Dicey. Introduction to the Study of the Law of the Constitution. London: Elibron.com, 2000. Australian Bureau of Statistics. Australian Capital Territory in focus. Queensland: Australian Bureau of Statistics, 2003. Cope, J. M. Business taxation: policy & practice. London: Taylor & Francis, 1988. Francis, Hilliard. The law of taxation. Houston: Wm. S. Hein Publishing, 1997. Leslie, Zines. The High Court and the Constitution. Queensland: Federation Press, 2008. Peter John Hanks and Jacob Isaac. Australian constitutional law. Quebec: Butterworths, 1985. Rob Woellner, Barkooczy, and Chris Evans. Australian taxation law. Queensland: Australia Limited, 2009. Read More