Air Caledonie International v Commonwealth, is a High Court of Australia case that provides guidance as to the constitutional definition of a tax.

Facts

The Commonwealth passed an amendment modifying the Migration Act 1958. The amendment imposed a fee on all persons entering Australia for immigration clearance. The implementation of such a scheme meant that airline operators would have to make payments to the Commonwealth government.

Decision

The High Court unanimously held that the fee for migration clearance was a tax. If section 55 of the Australian Constitution (which requires that legislation imposing tax deals only with imposing tax) is read literally, the effect of this decision would have invalidated the rest of the Migration Act. The Court was thus careful to invalidate only the Amending Act. The migration clearance fee was a tax because it has all the positive attributes of a tax. It was: The court also provided some guidance as to the characteristics of a tax: The court also made a distinction between citizens and non-citizens. An Australian citizen cannot be stopped from entering Australia, so although they paid the clearance fee, no service was being rendered to them. Hence the fee paid could not have been a fee for a service.