LORD
PHILLIMORE
:—There
is
no
dispute
of
fact
in
the
case:
and
the
sole
point
to
be
determined
is
whether
the
appellant
was
rightly
assessed
and
taxed
under
the
Income
War
Tax
Act,
1917
(Can.),
ce.
28,
and
the
amending
statute
of
1919
(Can.),
e.
55,
in
respect
of
his
salary
of
$6,000
a
year
as
Minister
of
Agriculture
in
the
Government
of
the
Province
of
Quebec
and
sessional
indemnity
of
$1,600
as
a
member
of
the
Legislative
Assembly
of
the
Province,
as
being
his
income
or
part.
of
his
income.
It
was
admitted
for
the
purposes
of
the
action
that
the
Minister
of
Finance
determined
pursuant
to
the
requirements
of
the
Acts
that
the
amount
payable
for
tax
by
the
appellant
was
the
sum
Of
$210
and
duly
notified
the
appellant
that
this
amount
was
payable
by
him,
and
that
in
so
determining
the
minister
took
into
account
the
appellant’s
salary
as
Minister
of
Agriculture.
It
was
contended
on
behalf
of
the
appellant
that
he
was
notwithstanding
not
liable
to
pay
this
sum
(1)
because
it
was
ultra
vires
of
the
Parliament
of
Canada
to
pass
the
Income
War
Tax
Acts
and
(2)
because
in
any
event
he
was
not
liable
to
taxation
in
respect
of
his
salary
as
provincial
minister
or
his
sessional
indemnity.
The
important
provisions
of
the
Income
War
Tax
Act,
are
secs.
3
and
4:
"3.
(1)
For
the
purposes
of
this
Act,
‘income’
means
the
annual
net
profit
or
gain
or
gratuity,
whether
ascertained
and
capable
of
computation
as
being
wages,
salary,
or
other
fixed
amount,
or
unascertained
as
being
fees
or
emoluments,
or
as
being
profits
from
a
trade
or
commercial
or
financial
or
other
business
or
calling,
directly
or
indirectly
received
by
a
person
from
any
office
or
employment,
or
from
any
profession,
or
calling.
.
.
.”?
Then
follow
certain
exemptions
and
deductions
not
material.
"4.
(1)
There
shall
be
assessed,
levied
and
paid,
upon
the
income
during
the
preceding
year
of
every
person
residing
or
ordinarily
resident
in
Canada
or
carrying
on
any
business
in
Canada,
the
following
taxes
:
‘
‘
And
then
follow
the
varying
rates
according
to
the
amount
of
the
income.
The
statute
of
1919
amending
the
Income
War
Tax
Act,
provided
as
follows
:
1
"
2.
(1)
Subsection
one
of
section
three
of
the
said
Act
[the
Income
War
Tax
Act,
1917]
is
amended
by
inserting
.
.
.
and
after
the
word
‘contract’
in
the
twenty-second
[i.e.,
the
last]
line
thereof
the
following:
‘and
including
the
salaries.
indemnities
or
other
remuneration
of
members
of
the
Senate
and
House
of
Commons
of
Canada
and
officers
thereof,
members
of
Provincial
Legislative
Councils
and
Assesmblies
and
Municipal
Councils,
Commissions
or
Boards
of
Management,
any
Judge
of
any
Dominion
or
Provincial
Court
appointed
after
the
passing
of
this
Act,
and
of
all
persons
whatsoever
-whether
the
said
salaries,
indemnities
or
other
remuneration
are
paid
out
of
the
revenues
of
His
Majesty
in
respect
of
His
Government
of
Canada,
or
of
any
province
thereof,
or
by
any
person,
except
as
provided
in
section
five
of
this
Act.’
”
Both
the
points
now
raised
by
the
appellant
were
fully
dealt
with
in
the
judgment
of
Audette,
J.
When
the
case
came
before
the
Supreme
Court
of
Canada,
[1923]
1
D.L.R.
1173,
the
judgment
was
concise,
the
Chief
Justice
on
behalf
of
the
Court
stating
that
he
thought
that
the
case
was
settled
by
the
previous
decision
of
the
Court
in
Abbott
v.
City
of
St.
John
(1908)
40
S.C.R.
597,
in
which
case
an
official
of
the
Dominion
Government
had
been
assessed
on
his
income
as
such
official,
and
it
had
been
held
that
the
Provinces
had
the
right
to
impose
Income
Taxes
upon
Dominion
officials
resident
within
them
in
respect
of
their
official
salaries.
The
Court
thought
that
the
present
case
was
the
converse
of
the
Abbott
case
and
was
governed
by
the
same
reasons.
The
whole
matter
turns
on
the
construction
and
application
of
secs.
91
and
92
of
the
B.N.A.
Act
of
1867,
and
their
Lordships
in
determining
it
are
assisted
and
guided
by
the
mass
of
decisions
on
these
two
sections
which
have
been
previously
given
by
the
Board.
By
sec.
91
of
the
Act
it
is
provided
that
:
"
"91.
It
shall
be
lawful
for
the
Queen,
by
and
with
the
Advise
and
Consent
of
the
Senate
and
House
of
Commons,
to
make
Laws
for
the
Peace,
Order,
and
good
Government
of
Canada,
in
relation
to
all
Matters
not
coming
within
the
Classes
of
Subjects
by
this
Act
assigned
exclusively
to
the
Legislatures
of
the
Provinces;
and
for
greater
Certainty,
but
not
so
as
to
restrict
the
Generality
of
the
foregoing
Terms
of
this
Section,
it
is
hereby
declared
that
(notwithstanding
anything
in
this
Act)
the
exclusive
Legislative
Authority
of
the
Parliament
of
Canada
extends
to
all
Matters
coming
within
the
Classes
of
Subjects
next
hereinafter
enumerated;
that
is
to
say:—
.
.
.
(3)
The
raising
of
Money
by
any
Mode
or
System
of
Taxation.
.
.
.
And
any
Matter
coming
within
any
of
the
Classes
of
Subjects
enumerated
in
this
Section
shall
not
be
deemed
to
come
within
the
Class
of
Matters
of
a
local
or
private
Nature
comprised
in
the
Enumeration
of
the
Classes
of
Subjects
by
this
Act
assigned
exclusively
to
the
Legislatures.
of
the
Provinces.”
Money
raised
by
an
Income
War
Tax
Act
is
unquestionably
money
raised
by
a
mode
or
system
of
taxation.
It
is
true
that
by
the
provisions
of
sec.
92
the
Legislature
in
each
Province
may
exclusively
make
laws
in
relation
to
certain
matters
coming
within
the
classes
of
subjects
which
are
there
enumerated,
and
that
one
of
these
classes
of
subjects
is
"‘Direct
Taxation
within
the
Province
in
order
to
the
Raising
of
a
Revenue
for
Provincial
Purposes’’.
As
such
particular
direct
taxation
is
reserved
to
the
Province,
to
that
extent
there
is
some
deduction
to
be
made
from
the
totality
of
power
apparently
given
exclusively
to
the
Dominion
Parliament
to
raise
money
for
any
purpose
by
any
mode
or
system
of
taxation.
This
apparent
antinomy
has
been
noticed
in
various
decisions.
It
is
sufficient
to
mention
the
cases
of
the
Citizens
Ins.
Co.
v.
Parsons
(1881)
7
App.
Cas.
96,
and
the
Bk.
of
Toronto
v.
Lambe
(1887)
12
App.
Cas.
575.
In
the
latter
case,
their
Lordships
observed
as
follows,
at
p.
585:
"‘It
is
impossible
to
give
exclusively
to
the
Dominion
the
whole
subject
of
raising
money
by
any
mode
of
taxation,
and
at
the
same
time
to
give
to
the
provincial
legislatures,
exclusively
or
at
all,
the
power
of
direct
taxation
for
provincial
or
any
other
purposes.
This
very
conflict
between
the
two
sections
was
noticed
by
way
of
illustration
in
the
case
of
Parsons
[supra].
After
quoting
from
the
earlier
judgment,
their
Lordships
proceeded
:
"Their
Lordships
adhere
to
that
view,
and
hold
that,
as
regards
derect
taxation
within
the
province
to
raise
revenue
for
provincial
purposes,
that
subject
falls
wholly
within
the
jurisdiction
of
the
provincial
legislatures.”
Both
sections
of
the
Act
of
Parliament
must
be
construed
together
;
and
it
matters
not
whether
the
principle
to
be
applied
is
that
the
particular
provision
in
sec.
92(2),
effects
a
deduction
from
the
general
provision
in
sec.
91(3),
or
whether
the
principle
be
that
sec.
91(3)
is
confined
to
Dominion
taxes
for
Dominion
purposes.
The
only
occasion
on
which
it
could
be
necessary
to
consider
which
of
these
two
principles
was
to
guide,
would
be
in
the
not
very
probable
event
of
the
Parliament
of
Canada
desiring
to
raise
money
for
provincial
purposes
by
indirect
taxation.
It
might
then
become
necessary
to
consider
whether
the
taxation
could
be
supported
because
the
power
to
impose
it,
given
by
subsec.
3
had
not
been
taken
out
of
the
general
power
by
the
particular
provision,
or
because
though
not
given
by
subsec.
3,
it
was
given
as
a
residual
power
by
the
other
parts
of
sec.
91.
But
no
such
question
arises
now.
Upon
any
view
there
is
nothing
in
sec.
92
to
take
away
the
power
to
impose
any
taxation
for
Dominion
purposes
which
is
prima
facie
given
by
sec.
91(3).
It
is
not
therefore
ultra
vires
on
the
part
of
the
Parliament
of
Canada
to
impose
a
Dominion
Income
Tax
for
Dominion
purposes;
and
the
first
point
must
therefore
be
decided
against
the
appellant.
Then
as
to
the
second
point,
certain
incomes
such
as
those
of
the
Governor-General
of
Canada
and
Consuls
and
Consuls-
General
are
exempted
from
taxation
by
the
Acts
in
question;
and
if
there
were
Foreign
Ministers
resident
in
Canada,
it
would
no
doubt
be
proper
that
in
accordance
with
international
law,
their
incomes
should
either
be
expressly
exempted
or
impliedly
held
exempt
from
taxation.
But
their
Lordships
can
see
no
reason
in
principle
why
any
of
the
sources
of
income
of
a
taxable
citizen
should
be
removed
from
the
power
of
taxation
given
to
the
Parliament
of
Canada.
It
may
be
doubted
whether
it
was
necessary
to
amend
the
original
Act
in
order
to
bring
the
various
officers
mentioned
in
sec.
2
of
the
Act
of
1919
within
the
scope
of
the
Act
of
1917.
But
assuming
that
this
amending
legislation
was
necessary,
it
is
not
to
be
regarded
as
in
the
nature
of
a
specific
legislation
directed
against
certain
public
officers,
but
merely
as
declaratory
that
certain
classes
of
income
are,
as
they
certainly
would
be
in
this
country,
liable
to
taxation
and
not
exempt.
Various
extreme
cases
were
suggested
by
counsel
in
argument.
Objections
of
this
class,
however,
were
well
met
by
Davies,
J.,
when
giving
the
leading
judgment
in
the
case
of
Abbott
v.
City
of
St.
John,
supra.
He
was
dealing
with
the
inmposition
of
tax
by
the
Province
upon
a
Dominion
official,
which
imposition,
it
was
contended,
contravened
the
provisions
of
sec.
91(8),
a
subsection
which
gives
to
the
Dominion
‘‘the
fixing
of
and
providing
for
the
Salaries
and
Allowances
of
Civil
and
other
Officers
of
the
Government
of
Canada’’.
He
said,
40
S.C.R.,
at
pp.
606-7:
"‘The
province
does
not
attempt
to
interfere
directly
with
the
exercise
of
the
Dominion
power,
but
merely
says
that,
when
exercised,
the
recipients
of
the
salaries
shall
be
amenable
to
provincial
legislation
in
like
manner
as
all
other
residents.
‘
‘
‘"It
is
said,”
he
continued,
‘‘the
legislature
might
authorise
an
income
tax
denuding
a
Dominion
official
of
a
tenth
or
even
a
fifth
of
his
official
income
and,
in
this
way,
paralyse
the
Dominion
service
and
impair
the
efficiency
of
the
service.
But’it
must
be
born
in
mind
that
the
law
does
not
provide
for
a
special
tax
on
Dominion
officials
but
for
a
general
undiscriminatory
tax
upon
the
incomes
of
residents
and
that
Dominion
officials
could
only
be
taxed
upon
their
incomes
in
the
same
ratio
and
proportion
as
other
residents.
At
any
rate,
if,
under
the
guise
of
exercising
power
of
taxation,
confiscation
of
a
substantial
part
of
official
and
other
salaries
were
attempted,
it
would
be
then
time
enough
to
consider
the
question
and
not
to
assume
beforehand
such
a
suggested
misuse
of
the
power.”
In
Great
West
Saddlery
Co.
v.
The
King,
58
D.L.R.
1,
[1921]
2
A.C.
91,
provincial
legislation
which
had
the
effect
of
precluding
Dominion
trading
companies
from
carrying
on
their
business
in
the
Province
unless
they
complied
with
certain
special
terms,
was
held
ultra
vires
as
calculated
to
abrogate
the
capacity
or
derogate
from
the
status
which
it
was
in
the
power
of
the
Parliament
of
Canada
to
bestow;
and
a
general
principle
wsa
laid
down
that
no
Provincial
Ligeslature
could
use
its
special
powers
as
an
indirect
means
of
destroying
powers
given
by
the
Parliament
of
Canada.
By
parity
of
reason
the
Parliament
of
Canada
could
not
exercise
its
power
of
taxation
so
as
to
destroy
the
capacity
of
officials
lawfully
appointed
by
the
Province.
But
the
Income
Tax
Acts,
notwithstanding
the
special
language
of
the
second
Act,
are
not
discriminating
statutes.
They
are
statutes
for
imposing
on
all
citizens
contributions
according
to
their
annual
means,
regardless
of,
or
it
may
be
said
not
having
regard
to,
the
source
from
which
their
annual
means
are
derived.
For
these
reasons
and
for
those
given
by
the
Judges
of
the
majority
in
Abbott
v.
City
of
St.
John,
supra,
to
which
their
Lordships
desire
to
express
their
assent,
their
Lordships
will
humbly
recommend
His
Majesty
that
this
appeal
should
be
dismissed
with
costs.
Appeal
dismissed.
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