87 ATC 1195
RK Todd DP
Administrative Appeals Tribunal
Judgment date: 27 November 1987.
R.K. Todd (Deputy President): The applicant in these references is a sales tax investigator with the Australian Taxation Office. In both the years of income ended 30 June 1983 ("fiscal 1983") and in fiscal 1984 he claimed a deduction of $300 for "Clothing - excess wear and tear as investigation officer as per Plain Clothes Police/Customs, 48 weeks @ $6.25". In fiscal 1984 he also claimed $120 self-education expenses being "Meals Excess (sec. 159U) 60 @ $2.00". All of the above claims were disallowed both on assessment and upon objection.
2. The claim for meals arose from the applicant pursuing a course of study to facilitate his promotion within the Taxation Office. There is no dispute that the expenses of self-education were incurred in gaining or producing the assessable income. The question for the Tribunal is whether the expenditure is of a private nature.
3. It was submitted by the applicant's representative that the applicant was required to be at the university at a time when people would normally eat dinner. The amount claimed was the difference between the cost of eating at home and the cost of eating at the university and was therefore, he said, deductible.
4. In Case U148,
87 ATC 868, Mr Roach (Senior Member) examined the case of a truck driver who had to eat breakfast, lunch and dinner "on the road". In that case Mr Roach found that the additional cost of breakfast and dinner was an allowable deduction but that lunch was not allowable due to its private nature. At p. 871 he stated:
"... All of the foregoing considerations are relevant to an exercise of judgment as to whether the degree of departure from the norm or commonplace is sufficient to displace the finding to be ordinarily made, namely, that meals are `private' in nature; and that the costs of purchasing either `fast-food' or lavish restaurant meals are no less `private', and no more deductible, than the cost of having meals provided in the privacy of one's home.
... In all the circumstances I think a distinction is to be drawn between `ordinary' days and those days upon which his duties involving travelling would take him away from his home-district for so long as to give rise to a need, or perceived need, for three meals. The latter should be recognised as giving rise to an entitlement. For those days, and those days only, I would allow the deduction claimed."
5. Evidence before the Tribunal in the immediate case showed that it would have been impractical for the applicant to eat at home on the nights claimed. As the claim is only for the excess above what eating at home would cost, and as it was incurred in pursuing a course of study, other expenses of which were conceded to be in the course of the production of assessable income, I find that the amounts claimed are allowable pursuant to sec. 51(1).
87 ATC 1197
As the provisions of sec. 82A have been satisfied by other amounts in the applicant's return, there is no need to consider that section or the rebate provisions of sec. 159U.
6. The claim for clothing expenses raises similar issues to those in another matter (Decision No. 3921, 27 November 1987) the decision in which is also being handed down today [reported as Case U219,
87 ATC 1221].
7. The applicant in this case is required to wear a suit and tie to work. Part of his duties involved visiting various taxpayers such as electroplaters, printers and surfboard makers. To that extent the facts were very similar to those in Case U73,
87 ATC 450, With respect, I confess to a good deal of difficulty with the reasoning in that decision. The decision was no doubt correct, in that the applicant, while she gave some more detail than did the present applicant (see para. 10 below) as to actual wear and tear or soiling of the clothing in question, nevertheless seems to have failed to establish her claim with an adequate degree of specificity. I do not for myself, however, see the matter as having been one that should have been dismissed on the basis of the principles laid down in
Lunney v. F.C. of T.; Hayley v. F.C. of T. (1958) 100 C.L.R. 478. Those principles deny that deducibility can be established simply because had the expenditure not been incurred the income would not have been derived. They cannot be inverted so as to deny deducibility where the expenditure has been incurred very much as part and parcel of the carrying out of the work from the doing of which income has been derived.
8. It was submitted on behalf of the applicant that the amounts were deductible on at least one of the following bases:
- (a) That it was an express condition of employment to wear a suit and tie and the expenditure was therefore incidental and relevant to gaining or producing assessable income.
- (b) That the applicant incurred abnormal expenditure due to the terms and conditions of his employment which caused greater wear and tear.
- (c) That uniformity of application of the ITAA requires that the applicant's claim be allowed because Customs and Australian Federal Police officers doing similar work are allowed these deductions.
9. The first and second of these bases are examined in the Decision No. 3921 mentioned above and I repeat the findings which I there gave. The first basis is clearly not sustainable unless it can be shown that the clothing has some unusual character apt to remove the predominantly private nature of the expenditure.
10. Specific evidence was lacking both as to any additional wear and tear which the applicant's clothing may have suffered during the years in question and as to the relationship that such wear and tear may have had to the amounts claimed. The claim was simply based on an amount that the Taxation Office allowed as a deduction to various other groups, notably police and customs officers. The need for records both of the damage and of the expenditure are expressed in the other case mentioned. While I can accept that the applicant suffered greater wear and tear to his clothing than would a "normal" employee, the expression of the claim by reference to other workers makes it impossible for me to calculate an allowable amount.
11. Many taxpayers feel aggrieved when they are denied a deduction when a person in a seemingly equal or less meritorious situation is found to have been allowed a similar deduction. The Tribunal cannot, however, use this as a basis for decision. To do so would require the Tribunal to decide whether or not the other person was properly granted a deduction. As Connolly J. stated in
Evans v. F.C. of T. 86 ATC 4901 at p. 4905:
"... One thing, however, is certain. All socially desirable objects are not tax deductible and all objects which are tax deductible are not necessarily socially desirable. In historical terms, those who make the taxation laws have responded over 50 years or so to pressures for the mitigation of their impact and this response has been haphazard, partial and usually by way of uneasy compromise.
The appellant pointed with some scorn to a case in which the cost of transacting the business of a professor of law by way of entertainment on licensed premises was allowed. He was, not unnaturally, disposed to suggest that his own case was far more meritorious. He may indeed be correct in this, but from what I have already said
87 ATC 1198
about this legislation, it is obvious that only by accident could the type of system with which we are here concerned have any moral content. Indeed, at present Australia is seeing tax imposed on one group of the society by reason of its provision of benefits for another group, frequently under the compulsion of the law. I mention all this only to show that one simply cannot infer from the fact that in one situation the cost of self-education is deductible, that the Parliament is likely to have intended it to be deductible in another. The appellant must resign himself to the fact that he is living in an imperfect world."
12. This is also the position in which the applicant in this case finds himself. For him to obtain a deduction related to clothing he had to show some particular impact upon the clothing, its relation to his work and the expense or loss incurred. As he was unable to achieve this his claim must fail.
13. For the reasons given above the objection decision of the respondent for fiscal 1984 is varied by allowing a further deduction of $120. The objection decisions of the respondent are otherwise affirmed.