The crap you can write when an abstract deadline has passed. Tax avoidance and the judiciary: a Marxist analysis Is the undermining of general anti-avoidance provisions in Australia systemic, driven by something deeper than just interpreting the words? I was prompted to do then research after the undermining of Part IVA became evident and then after the recent changes to the provisions. I read something I wrote 20 years ago for the Federal Law Review called Tax Avoidance in Australia: Results and Prospects. All those twenty years ago I made this courageous prediction: The clash between choice and predication represents something deeper in our society. It is about two seemingly very different approaches to the role of the market and the state in society. Because those approaches flow from structural elements found in capitalism itself, the debates found in the cases on s260 will re-occur in relation to Part IVA. This does not necessarily mean that choice and predication will be adopted to explain Part IVA, but it does mean that the philosophies which underpinned both choice and predication will be reflected in the interpretation of Part IVA. The government in 2013 amended Part IVA to overcome a particular judicial interpretation but if the undermining is systemic then this in the long term won’t address the problems. I turned to Pashukanis to see if his analysis can help. Does his book ‘The general theory of Marxism and Law’ offer anything useful in this discussion? Pashukanis argues that the rights of equality, free will and private ownership arise from commodity exchange and result in the abstract legal subject with those rights. And so when a taxpayer and the ATO battle it out they do so as the bearers of abstract rights – the ATO for communal individualism, or in the words of Pashukanis ‘equality’, and for the taxpayer individualism – i.e. private property interests – to arrange their affairs in whatever way they feel appropriate commercially and to do so as an exercise of their free will. If we introduce a GAAP into the story however, that may impinge on the right to receive a fair share of the value (i.e. seemingly reflecting an appropriate return on investment) in the form of profit, interest, rent and so on. It undermines or can undermine the results of the distribution arising from the exchange of the commodity not between those who exchange the commodity but between the State and the recipient of the income arising from that exchange. In this sense the state is stepping into the shoes of an abstracted individual in extracting revenue through one of its agents (in this case the ATO) from other members of the band of hostile brothers and in doing that is really leaving the realm of production and entering the realm of the circulation of capital and money as a parasite on the productive and exchange processes. The judiciary seems to abhor parasites. And yet the state is not a parasite. It is integral to capitalism. This may help explain the systemic tension within the judiciary (think choice and predication for example) over general anti-avoidance provisions.
Posted on: Wed, 01 Oct 2014 01:05:24 +0000
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