An old methodology in a new world: a comment on our current system of judicial decision making in tax cases

The traditional approach to resolving tax disputes adopted by the judiciary is to look to the words of the legislation to identify parliament's intention. However this approach is founded on the fallacy that words have a ‘correct’ meaning which is there for the judiciary to discover. In fact, language is inherently imprecise and, typically, in difficult tax cases the determination of how the legislation was meant to apply to the facts of the particular case is at best a guess. Yet, as if in fear of a great lie being discovered, the judiciary will seek to clothe their guess with respectability by employing rhetorical devices designed to persuade the reader that they have identified the undeniable truth. However, ultimately, such a subterfuge does not do justice to the parties to the litigation nor establish an effective precedent. These cases fail a cost-benefit analysis. They indicate that a new approach is needed that is prepared to acknowledge the inherent uncertainty of language and to seek to establish a precedent by reference to the underlying policy objectives of the legislation. This will require mechanisms to assist the courts to identify the relevant policy considerations and to ensure that justice is done in the case at hand