John Fairfax and Sons Limited v New South Wales

In *John Fairfax & Sons Limited v New South Wales*, the plaintiffs, including John Fairfax & Sons Ltd and Smith's Newspapers Ltd, sought declarations that the *Finance (Newspapers Taxation) Act 1926* (NSW) and certain sections of the *Finance (Taxation Management) Act 1926* (NSW) were invalid. They argued these Acts were inconsistent with the Commonwealth Constitution and sought injunctions to prevent their enforcement. The dispute centred on a tax imposed by the New South Wales Parliament on each copy of a newspaper issued for sale within the state. The High Court of Australia heard the matter on motions for judgment.

The central legal issue before the High Court was whether the tax imposed by the New South Wales Act constituted a "duty of excise" within the meaning of section 90 of the Commonwealth Constitution. If it was a duty of excise, then the State Parliament lacked the power to impose it, rendering the Act invalid. The Court was required to determine if newspapers, as the subject of the tax, fell within the constitutional definition of goods for the purposes of excise duties, and consequently, whether the State's legislative power was excluded by section 90.

The High Court, by a majority, held that the tax imposed by the *Finance (Newspapers Taxation) Act 1926* (NSW) was indeed a duty of excise within the meaning of section 90 of the Constitution. The Court reasoned that the tax was levied on a tangible article produced for sale, and in substance, did not differ from taxes on other manufactured goods. This reasoning followed the principles established in *Commonwealth and Commonwealth Oil Refineries Ltd v South Australia*. Consequently, the Court found the Act to be beyond the legislative competence of the New South Wales Parliament. The Court also declared that the machinery provisions in sections 2, 3, 5, 6, and 7 of the *Finance (Taxation Management) Act 1926* (NSW), which were designed to enforce the invalid taxation Act, were also invalid.