This is my attempt at codifying a constitutional TABOR reform for Australia. The intent of the reform is to put the power of taxation much more into the hands of the people. As such it is a democratic reform. It does not attempt to take away from government the power to formulate the nature or structure of the tax system. It merely seeks to constrain the overall ability of the government to raise its price without the direct consent of the people.
In drafting this reform there is a tension between finding a form of wording that is specific enough to prevent a later creative legal misinterpretation, simple enough to be communicated during the reform process and generous enough to negate most serious arguments against it.
There are terms and concepts within my codification that could theoretically be fleshed out in more detail but having reflected on this over a long period I think that it is better to keep the terminology as simple as possible and to leave the interpretation to the courts. Some may see risks in this given the history of courts to discover unexpected interpretations, however I don’t think additional detail would guarantee against this risk and I have been careful in crafting the wording to avoid any ambiguity. Further more I think additional detail would make communicating and selling such a constitutional reform much more difficult.
I have avoided any reference to inflation to avoid any subsequent legal redefinitions of how inflation is measure or how high inflation is. Instead I have opted for a fixed figure that corresponds to the current upper limit of inflation targeted by the reserve bank.
My codification leaves open the opportunity for taxation to be increased at the state level and leaves jurisdictional competition to deal with such eventualities.
Here is my wording as I would seek to have installed in the Australian constitution:-
The total taxation revenue appropriated by the commonwealth government in any given tax year, must be less than the national population multiplied by $20,000. However whilst retaining this formulation an alternate to the $20,000 figure may be substituted through legislation so long as the alternate figure effective in any given tax year meets one of the following two criteria:-
i) the alternate figure is approved by a majority of the citizens in a plebiscite.
– or –
ii) the alternate figure is no more than 3% higher than the figure effective in the preceding tax year
In the event that the otherwise lawful total taxation revenue collected in relation to a given tax year should breach the proscribed limit then each tax payer shall, in proportion to that excess, be entitled to a reduction in their tax liability for that year.