Anthony Craig and Commissioner of Taxation

[2015] AATA 339

[2015] AATA  339

Division	SMALL TAXATION CLAIMS TRIBUNAL
File Number	2015/1086
Re	Anthony Craig
APPLICANT
And	Commissioner of Taxation
RESPONDENT

DECISION

Tribunal	Prof R Deutsch, Deputy President
Date	21 April 2015
Date of written reasons	18 May 2015
Place	Sydney

The application for review is dismissed pursuant to subsection 42A(4) of the Administrative Appeals Act 1975.

In doing so the Tribunal has not considered, and makes no comment in respect of, whether the matters raised by the Applicant have been established as the Tribunal has no jurisdiction to hear the application.

.........................[sgd]...............................................

Prof R Deutsch, Deputy President

CATCHWORDS

PRACTICE AND PROCEDURE – Jurisdiction – whether Tribunal has jurisdiction to review purported decision – objection to Australian government expenditure of Applicant’s income tax as outlined in Tax Receipt issued in conjunction with Notice of Assessment – whether purported decision is a reviewable objection decision – meaning of ‘assessment’ - not reviewable as Tax Receipt does not form part of assessment – application for review dismissed

LEGISLATION

Administrative Appeals Tribunal Act 1975 (Cth) ss 25(1), 25(4)

Income Tax Assessment Act 1936 (Cth) s 6(1), 175A(1)

Taxation Administration Act 1953 (Cth) Pt IVC Div 3, ss 14ZQ, 14ZY(1), 14ZZ(1)

SECONDARY MATERIALS

Explanatory Memorandum, Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014 (Cth)

REASONS FOR DECISION

Prof R Deutsch, Deputy President

INTRODUCTION

1. This case essentially concerns an application by the Applicant to review his objection to the way in which his income tax was notionally spent by the Australian Government.

2. More particularly, the Applicant objects to the portion of his income tax that was spent on foreign aid ($317) and on defence ($1560). According to the Applicant, these amounts of expenditure were used to finance atrocities committed by the Indonesian military. He requests that this portion of his income tax be reallocated to Australian essential services.

3. The genesis for the idea that such an objection could be made arose largely as a result of the issue to the Applicant of a Tax Receipt with his Notice of Assessment for the year ended 30 June 2014 (the “Assessment”).

4. As indicated above, the Tax Receipt disclosed that a portion of the income tax for which he had been assessed, had been allocated to spending on defence as well as foreign affairs and economic aid.

   FACTS

5. On or about 25 August 2014, the Applicant lodged his income tax return for the year ended 30 June 2014.

6. On or about 2 September 2014, the Respondent issued the Applicant with a Notice of Assessment for the year ended 30 June 2014. Included with the Assessment was a Tax Receipt which provided a breakdown of how the Applicant’s income tax notionally contributed to government expenditure during that year.

7. On or about 10 September 2014, the Applicant purported to object to the Tax Receipt, on the basis that he was opposed to a portion of his taxes being allocated to foreign aid and defence.

8. The Applicant alleged that by allocating funding to these areas, the Australian Government has been financing atrocities committed by the Indonesian military. He requested that this portion of his income tax be reallocated to Australian essential services.

9. On or about 11 February 2015, the Applicant lodged a further purported objection against the Tax Receipt. This purported objection disclosed that the Applicant objected to a portion of his taxes being allocated to foreign aid ($317) and defence ($1,560) and raised similar grounds to those advanced in the Applicant’s earlier purported objection.

10. On or about 2 March 2015, the Respondent sent a letter to the Applicant advising        that the Australian Tax Office’s (the “ATO”)’ role is to collect tax revenue on behalf of the Australian Government and that the ATO has no influence over how tax revenue is allocated by the Government.

11. On 6 March 2015, the Applicant lodged an application with this Tribunal seeking review of the Respondent’s letter of 2 March 2015 (the “application for review”).

12. On 9 March 2015, the Tribunal sent a letter to the Applicant advising that it was unclear whether the Tribunal had jurisdiction to review the Respondent’s correspondence of 2 March 2015. The letter advised that the Tribunal can only review a decision that has first been reviewed by the Respondent and that it was not clear that this had happened. The letter asked the Applicant to explain why he believed the Tribunal had the necessary jurisdiction and advised that if cannot establish this, the application may be dismissed.

13. On or about 13 March 2015, the Applicant contacted an officer employed by the Respondent and advised that the Tribunal would not consider his application for review unless he could provide formal notification that his objection had been disallowed.

14. On 17 March 2015, the Respondent sent a letter to the Applicant advising that the objection lodged by the Applicant on 10 September 2014 was invalid because the         Tax Receipt did not form part of the Applicant’s income tax assessment (the “purported decision”). The letter advised that the laws administering the distribution of Commonwealth funds did not fall within the Respondent’s           powers and suggested the Applicant consider raising his concerns with his local Member of Parliament.

15. On 20 March 2015, the Applicant sent an e-mail to the Tribunal submitting that the Respondent:

    has an obligation to ensure that taxes collected and given to government departments are not used for illegal means or in breach of Australian domestic law or international law under out treaty obligations (external affairs under the Australian Constitution).

16. The e-mail further stated that the Applicant, being an Australian taxpayer, has a right to obtain “reassurance that Tax Commissioner is looking after my interest and that of fellow Australians”. The e­mail noted that Australian laws apply to all; including public sector employees employed in Commonwealth departments such as the Departments of Foreign Affairs and Trade and Defence.

17. On 23 March 2015, the Tribunal sent a letter to the Applicant advising that the Tribunal did not have the power to review the purported decision. The Tribunal’s letter invited the Applicant to identify the source of the Tribunal’s power to review the purported decision if he believed that the Tribunal had jurisdiction.

18. The Applicant responded on 23 March 2015 in a letter alleging, inter alia, that the Respondent had failed to undertake due diligence to ensure that Commonwealth revenue had not been applied towards illegal purposes.

    THE RELEVANT LEGISLATION

19. Pursuant to section 25(1) of the Administrative Appeals Tribunal Act 1975 (Cth) (the “AAT Act”) an enactment may provide that applications may be made to the Tribunal for review of decisions made in the exercise of powers conferred by that enactment.

20. Subsection 25(4) of the AAT Act provides that the Tribunal has power to review any decision in respect of which application is made to it under any enactment.

21. The enactment that confers upon the Tribunal jurisdiction to review decisions in relation to income tax is the Taxation Administration Act 1953 (Cth) (the “TAA 1953”).

22. Subsection 175A(1) of the Income Tax Assessment Act1936 (Cth) (the “ITAA 1936”) provides that a taxpayer who is dissatisfied with an assessment made in relation to the taxpayer may object against it in the manner set out in Part IVC of the TAA 1953.

23. “Assessment” is defined in section 6(1) ITAA 1936 and relevantly means

    (a)       the ascertainment:

    (i) of the amount of taxable income (or if there is no taxable income); and

    (ii) of the tax payable on that taxable income (or that no tax is payable);and

    (iii) of the total of the taxpayer’s tax offset refunds for a year of income (or that the taxpayer can get no such refunds for the year of income;…

24. When a taxpayer makes an objection that complies with the requirements prescribed by Division 3 of Part IVC, the Respondent must, pursuant to section 14ZY(1) of the TAA 1953, make a decision on the objection.

25. If a taxpayer is dissatisfied with the Respondent’s objection decision, they may, if the decision is a reviewable objection decision, either apply to the Tribunal for review of the decision; or appeal to the Federal Court against the decision: section 14ZZ(1) of the TAA 1953.

26. A ‘reviewable objection decision’ is defined as an objection decision that is not an ineligible income tax remission decision: section 14ZQ of the TAA 1953. The expression ‘ineligible income tax remission decision’ is not relevant for present purposes.

    THE APPLICANT’S POSITION

27. The Applicant submits that the Respondent has a duty to ensure that taxes collected by him are not used for illegal means by other government departments. The Applicant alleges that the Respondent has failed to discharge this duty. The Applicant alleges that the Department of Defence and Department of Foreign Affairs and Trade are supporting the Indonesian military in the commission of war crimes and other illegal activities. Accordingly, the Applicant objects to tax expenditure on programs associated with these departments.

    THE RESPONDENT’S POSITION

28. The Respondent submits that the Tribunal does not have jurisdiction to review the matters raised by the Applicant in his application for review.

    THE ISSUES

29. The issues for determination before this Tribunal are as follows:

    (a)Whether the Tribunal has jurisdiction to review the ‘decision’ that is the subject of the application for review?

    (b)If so, whether the matters raised by the Applicant are established?

    CONSIDERATION

30. In this case, in order that the Tribunal’s jurisdiction be engaged the following conditions must be fulfilled:

    oFirst, the Respondent must have made an assessment in relation to the taxpayer;

    oSecondly, the taxpayer must have objected against that assessment;

    oThirdly, the Respondent must have made a decision on the objection; and

    oFourthly, the taxpayer, being dissatisfied with the objection decision, must have  applied to the Tribunal for a review of that decision.

31. There is no argument that the Respondent has made an assessment of income tax in relation to the Applicant for the year ended 30 June 2014.

32. Having regard to the definition of “assessment” in s 6(1) ITAA 1936, it is clear that the Assessment extends to the ascertainment of the Applicant’s taxable income, the tax payable by the Applicant and any tax offset refunds to which the Applicant would be entitled. It clearly does not extend to the way in which the tax collected from the Applicant was notionally applied by the Respondent.

33. Thus, the Applicant has not objected to the Assessment. Clearly, the Applicant has a problem with the Tax Receipt that accompanied the Assessment and, in particular, the notional allocation of taxation revenue disclosed therein.

34. The problem is that the Tax Receipt does not form part of the Assessment. It may well accompany the Assessment but it very clearly is not part of the Assessment.

35. Accordingly the conditions necessary to engage the Tribunal’s jurisdiction are not satisfied.

36. No reference is needed to any extraneous material as the position on this point is clear.

37. Nonetheless, the Respondent has drawn my attention to the Explanatory Memorandum to the Tax and Superannuation Laws Amendment (2014 Measures No. 4) Bill 2014 (the “EM”), which introduced the Tax Receipt initiative.

38. The EM explains that the Tax Receipt does not form part of a taxpayer’s Notice of Assessment. Relevantly, paragraph 4.18 provides:

    Where the Commissioner is required to issue a tax receipt to an individual, the receipt must be provided as soon as practicable after the income tax assessment is made. It is envisaged that, for the majority of applicable taxpayers, the receipt will be issued at the same time as the notice of assessment; however, the receipt does not form part of the notice (emphasis added).

39. As the Tax Receipt does not form part of the Assessment, the Applicant could not validly object to it pursuant to section 175A(1) of the ITAA 1936.

40. The Applicant has not asserted and I do not believe that there are any other provisions in any of the relevant tax legislation (e.g. the ITAA 1936, the Income Tax Assessment Act 1997 and the TAA 1953) which would otherwise give a taxpayer the right to object against a tax receipt.

41. Thus, the matters raised by the Applicant did not amount to a valid objection to the Assessment. The matters raised by the Applicant dealt with matters outside the Assessment. It must follow therefore that the Respondent has not made an objection decision that is capable of being reviewed by this Tribunal.

42. In view of the foregoing, I conclude that the Tribunal does not have jurisdiction to review the Purported Decision or any of the other matters raised in the application for review.

    DECISION

43. The application for review is dismissed pursuant to section 42A(4) of the AAT Act.

44. In doing so the Tribunal has not considered and makes no comment in respect of, whether the matters raised by the Applicant have been established as the Tribunal has no jurisdiction to hear the application.

I certify that the preceding 44 (forty-four) paragraphs are a true copy of the reasons for the decision herein of Prof R Deutsch, Deputy President

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Associate

Dated 18 May 2015

Date of hearing	21 April 2015
Applicant	In person
Solicitors for the Respondent	ATO Review and Dispute Resolution Group