Murphy v Obst

The High Court of Australia considered a dispute between Murphy and Obst concerning the interpretation and application of section 117 of the *Constitution*. The case involved a challenge to the validity of a state law that imposed a tax on certain interstate businesses.

The central legal issue before the Court was whether section 117 of the *Constitution*, which prohibits discrimination against residents of other states, had been contravened by the impugned state legislation. Specifically, the Court had to determine if the tax imposed a burden on interstate businesses that was not imposed on intrastate businesses, thereby constituting unlawful discrimination.

The Court's reasoning focused on the purpose and scope of section 117. It was held that the section is designed to ensure that residents of one state are not subject to discriminatory disabilities when they are in another state, or when they are carrying on business there. The Court analysed the specific provisions of the state tax and compared its operation on interstate businesses with its operation on intrastate businesses. The majority found that the tax did not discriminate in a manner prohibited by section 117, as any differential treatment was justified by legitimate state interests and did not create a burden solely by reason of interstate status.

The High Court dismissed the appeal, upholding the validity of the state legislation.