Assignment Background:
The ongoing conflict in Ukraine presents a host of economic, security, and diplomatic challenges for countries all around the world. The Australian government is no exception, and with the cost of living increasing the government is under pressure to help ease the burden on citizens whilst still engaging with a significant international matter. Parliament passes two pieces of legislation to respond to the crisis. The first Act, the Frivolous Entertainment (Cost of Living) Act 2023 (Cth) restricts and regulates various forms of recreational activity. The second Act, the Support for Ukraine Act 2023 (Cth) commits Australia to providing further military equipment for Ukraine, and requires sport training providers to assist with increasing fitness across the population in the unfortunate event that Australia is plunged into war.
Speaking on the passage of the two Acts, the Prime Minister made the following comments:
"Many Australians are doing it tough. It's our job to help them, but it's also our job to help the people of Ukraine too. With these two pieces of legislation, the government will help ensure that Australians are able to afford the necessities of life, while also being able to support our friends in Ukraine.
While Australia is not at war, it's clear that we need to tighten our belts. The Frivolous Entertainment (Cost of Living) Act cuts down on many of the forms of entertainment Australians hold dear, like going to the footy or watching a movie at the cinema. It's a painful thing to do, and I'll be sad to miss watching my beloved Rabbitohs every week. But this is something we have to do to make sure that we have the money to spend on the things we really need - groceries, electricity and secure and affordable housing.
We're also doing more to help Ukraine defend itself. Australia and the Anzac spirit is all about helping a mate in need, and this what the Support for Ukraine Act is all about. I'm sure if Australia was in the unfortunate position in which Ukraine finds itself, Ukraine would do the same for us. At the same time, we need to make sure that Australia is in the best position possible to defend ourselves. We have an incredible sporting culture, and I'd like our fantastic sporting clubs to help the nation lift its game in terms of fitness and healthy eating."
Relevant sections of each Act are set out as follows.
Frivolous Entertainment (Cost of Living) Act 2023 (Cth)
Section 1: Objects
To facilitate the government's response to a cost of living crisis, this Act:
- regulates the provision of entertainment services in Australia;
- introduces a new tax on entertainment services in order to provide cost of living relief to Australians in need
Section 2: Restriction of frivolous entertainment
- Corporations providing frivolous entertainment are limited to holding, offering or participating in one event per month
- For the purposes of this Act, 'corporation' means any corporation within the meaning of s 51(xx) of the Constitution
- For the purposes of this Act, 'frivolous entertainment' means the provision of services purely or predominantly for the purpose of entertainment, including but not limited to:
- Sporting events
- Performing arts
- For the purposes of this Act, 'event' includes shows, performances, games, matches or competitions
Section 3: Frivolous entertainment fee
- Corporations that sell tickets to frivolous entertainment events must pay a fee of $10 per ticket sold to the Australian Taxation Office
- Monies collected under the frivolous entertainment fee are to be spent by the government on measures to reduce the cost of living on essential items such as groceries and electricity.
You are solicitor engaged by Coffs Crocs Pty Ltd ("Coffs Crocs"), a corporation that owns and manages a regional football team (the Coffs Harbour Crocodiles). The Coffs Harbour Crocodiles run two teams in the Central Coast rugby league competition. They largely rely on government subsidies for funding, however they have just recently started selling tickets to games to assist with costs. Sale of tickets have accounted for approximately 5% of revenue in the 3 months since sales began. Coffs Crocs' main activities are skill building and training for promising young players, organising fixtures and competitions, and scheduling weekly games for their two teams.
Coffs Crocs are concerned about how the new legislation will impact them, and have two important questions:
Question 1: Is the Frivolous Entertainment (Cost of Living) Act 2023 (Cth) likely to be valid under the economic powers listed in the Australian Constitution? How might it impact Coffs Crocs?