Tax Avoidance in the United Kingdom, New Zealand, and Australia: The Sun Never Sets on the Judicial Umpire

• Author: Harry Erlichman
• Pages: 181-195

181

[seven ]

Tax Avoidance in the United Kingdom,

New Zealand, and Australia:

The Sun Never Sets on the Judicial Umpire

harry erlichman*

A. INTRODUCTION

e Supreme Court of Canada is not the on ly Commonwealth court to be

coping with tax avoidance. e cou rts in the United K ingdom, New Zea-

land, and Austral ia have gone through simila r exercises that include fact

situations remarkably simi lar to those in Canada Trustco. e ongoing Ca-

nadian conceptual concer ns echo in recent d ecisions of the Ho use of Lords

involving English, S cottish, and New Zealand appea ls, as well as in the Full

Federal Court of Australia.

e question is asked in di f‌ferent ways. What is acceptable ta x mitiga-

tion? When must a tax gai n be accompanied by real f‌inancial pain? W hen

did Parliament intend a liter al juristic interpretation? It is usef ul to remem-

ber that almost twenty-f‌ive years ago, when considering avoidance and the

old section  anti-avoidance test, Mr. Just ice Estey in Stubart Investments

Limited asked: “W hat then is the law in Canada a s regards the right of a

taxpayer to order his af‌f airs so as to reduce his tax liabi lity without breach-

ing any express terms in t he statute.” Before answering this stra ightforward

* Tax Law Services Se ction of the Ontario Region al Of‌f‌ice of the Canada Depa rtment of

Justice. e views e xpressed in this chapt er are those of the author and are not t o be

attributed to t he Department of Justice or t he Canada Revenue Agency.

e Queen v. Canad a Trustco Mortgage Company,  SCC  [Canada Trustco].

Stubart Invest ments Limited v. e Queen, []  S.C.R.  at  .