1942 – Commonwealth Takes Over Income Taxes

1942 – Commonwealth Takes Over Income Taxes

5 July 2017

Commonwealth taxes

The Commonwealth legislated that their income tax take priority over any State income tax and that any State retiring from income tax collection be paid a grant in compensation for lost revenue. The States rejected this tax takeover but the High Court ruled that the Commonwealth income tax legislation was valid, essentially giving the Commonwealth constitutional priority in taxation. 

  

commonwealth tax chart

The States were not precluded from superimposing their own income taxes on top of the Commonwealth tax, but if a State did so its Commonwealth tax reimbursement payment would cease. As the Commonwealth income tax rates were set at a level which made it difficult for the States to raise an amount equal to Commonwealth tax reimbursements they retired from the field of income taxation.


Posted in

Categories

Similar posts you may like

  • 1784 – The Hat Tax

    In 1784 Pitt the Younger introduced a tax on men’s hats to raise government revenue. The government believed the tax would be equitable as Read more

  • Silicon Valley turns into Crypto Valley!

    Cryptocurrencies, non-Fungible tokens (NFT’s) and crypto domains are all products of the skyrocketing blockchain industry. The amount of money moving through the blockchain community Read more

  • Is Bitcoin a Tax Haven?

    Bitcoins most important characteristic is that it is decentralised so no single institution controls the Bitcoin network. Bitcoin is pseudonymous, meaning that funds are Read more

  • 1974 – Suit Leasing Scheme

    In 1974 the UK’s top marginal tax rate of 83% applied to incomes over £20,000 (equivalent to £200,000 in 2018). In addition, passive investment Read more

"You’d be stupid not to try to cut your tax bill and those that don’t are stupid in business"

- Bono: U2