Taxing the Governor-General

The Law Commission has reviewed the Civil List Act 1979, as it pertains to the Governor-General. Their major recommendation is that the Governor-General no longer be exempt from income tax.

The exemption is traditional, based on a belief that you can’t tax the Crown. However even the Queen pays tax in the UK now, so it seems overdue for the Governor-General to do the same. Now this will not mean a pay drop for the next GG, as the Remuneration Authority will take account of the tax status in setting the salary.

A summary of their major recommendations:

  1. Pass a separate Governor-General Act defining the office, term and appointment, removing them from the Civil List Act.
  2. Have a permanent legislative authority for the funding of the Governor-General and their office and travel.
  3. Remove the exemption from income tax on the salary (but the allowance to cover expenses remains tax free).
  4. Remove Section 7 of the Civil List Act which allows the Minister of Finance to exempt the Governor-General from paying any public or local tax, duty, rate, levy or fee.
  5. Have an annuity determined by the Remuneration Authority for former GGs, and upon their death half that level paid to a surviving spouse or partner.
  6. When the Chief Justice (or other Judge) acts as Administrator of the Government they stay on their current salary, rather than the current law where they get paid 50% of their judicial salary and 50% of the GGs salary.

All looks pretty good to me.  A small but useful modernisation of our constitutional structure.

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