I reckon Clive Palmer might have gone burko, and is having delusions about having gone to law school instead of into real estate as a young fellow. But whatever the cause, he has moved off free speech as his focus last week on the constitutionality of taxation this week. Busy guy. Perhaps he reckons he can do it all: run his magic dirt and mineral enterprise, fight the FFA/FIFA, fight the mining tax and fight the carbon tax all at once. Or perhaps he is a full of shit, bluffing windbag.
I’m not a constitutional lawyer, but here is why I will go with option 2:
1. The Federal government has the right to impose taxes and duties. This has been tested a number of times, but is pretty solid, based on the amount that my company and I pay every quarter. I don’t reckon Clive is on a winner, if he wants to take on the constitutionality of taxation in general.
2. The Federal government has the right to identify air pollutants of concern and regulate the collection of data on them and their emissions into the receiving environment. We have about 40 years of precedent in this area generally. With respect to CO2, the basis upon which the carbon tax will be collected is the data generated under the National Greenhouse and Energy Reporting (NGER), and despite the huge shit fight over its introduction in industry, no industry lobbying group (and all the big ones were involved) ever suggested it was unconstitutional. It has also passed muster on the basis of sound scientific methodology, so there goes any arbitrary and capricious argument.
3. The Federal or State governments have the right to apply fees (or taxes) to companies that want to discharge pollutants to the common environment in their jurisdiction. Tipping fees, sewage charges and even air pollutant emissions are charged by State and Local governments now, and the extension of this to the Federal Government is not a huge reach in logic. He might be attempting the challenge in this area on the basis of an argument of Intergovernmental Immunity (thank you Wikipedia):
“… the Engineers’ Case held that there was no general immunity between State and Commonwealth governments from each other’s laws, the Commonwealth cannot enact taxation laws that discriminated between the States or parts of the States (Section 51(ii)), nor enact laws that discriminated against the States, or such as to prevent a State from continuing to exist and function as a state”
He may also want to make an argument based on an argument that the new law does not fall within a permissible head of power granted to the Commonwealth government by the Constitution.
While either of these is a possible route of attack, the case of the Carbon Tax being applied to the whole of the country is not likely to be found to be discriminatory against any state, and if this type of taxation of a pollutant is found to be a States’ right rather than the Commonwealth, there are one or more easy workarounds to deliver the intent.
4. But the most obvious reason this constitutional challenge isn’t going to hold water came from Clive himself. Clive was not willing to leak the details on the 730 Report of the precise basis of the means by which the carbon tax is unconstitutional. If he had anything, he’d come out with it. See, constitutional law isn’t like a regular tort. It isn’t like Clive would benefit by hiding his most excellent constitutional argument for a packed courtroom, spring it on the packed house and unsuspecting government barristers, get a judgement and penalty in his favour on the day and be carried off on the shoulders* of his supporters and then next day be much richer. If he had anything worth a damn, he would have won the argument last night with it.
Now, if there were some technicality that did allow the High Court to rule the carbon tax unconstitutional, the government would merely find another means by which to attach its revenue generating mechanism to existing sources to achieve the same effect**. For instance, it could use the NGER data collected to establish the amount owed by each business, then reduce the amount of GST or mining tax revenue returned to the individual states with the identification of the business that the reduction was due to, then suggest that the State recoup that revenue through rate-based licensing regulations that are already on the books by simply adding CO2-e to the pollutants of concern that they “tax” now.
But let’s hope Clive gets lots of lawyers in Sydney and Canberra involved, because that part of the country needs some stimulus. It would really nice if, like in a tort, the Federal government could recoup its costs from Clive when he is unsuccessful.
* if you could even picture that
** as it says right in the legislation, a similar case to many other precedents where a specific law was found unconstitutional, but that did not prevent the Commonwealth from delivering the intent of the law through other mechanisms.