The Definition of Taxation

Abstract

The essential nature of a tax for the purposes of the constitutional law of the systems studied here consists in its being a compulsory exaction,¹ enforceable by law, imposed under legislative authority, and made for a public purpose,² the broad objective of which may be stated as being support of the processes of government.³ This does not necessarily connote only support of governmental institutions as such, although these are obviously included. Particular levies may, however, be earmarked for special purposes so that where a particular service provided by government is of both general interest to the community at large and of special interest to a segment of the community, the cost of providing it may be apportioned between the two interests;⁴ it is sufficient if the levy is paid into a public fund and is thereafter subject to appropriation in the same manner as public moneys generally.⁵ Thus the exaction should not be wrested from its setting and its governmental purpose ignored. Money may not be demanded from one group solely for the benefit of another;⁶ but if the exaction has a legitimating governmental objective of regulation, it is of no consequence that its proceeds are distributed amongst a limited segment of the community.⁷ Determination of the objective of a tax is a question to be decided by the courts.⁸