personal tax—Article 87
the Constitution and liability to personal tax—Not reasonable to make in Cyprus a distinction between married and unmarried persons for such purposes—Equality before the law and discrimination, Article 28.1 and 2
the Constitution. Constitutional Law—Taxes—Personal tax—Imposition
Personal Contributions on Members
the Greek Community for the year 1961, Law No. 16
1961, as amended by Law 8/62 (Greek Communal Chamber Laws)- Section 20
Schedule "A" thereof and paragraphs 1 and 2
the Table
Rates
Taxation attached thereto, contravene Article 28 and Article 24.1
the Constitution, and are, therefore, unconstitutional. Revenue—Taxes—Personal tax—Distinction between married and unmarried persons for purposes
personal tax—Relationship between such distinction and Articles 22 and 87
the Constitution. Applicant who is a bachelor, filed this recourse under Article 146
the Constitution, seeking a declaration that the "assessment made by the Commissioner
Income T a x on him to pay personal tax for the year 1961 by the Commissioner
I n c o m e T a x u n d e r Law 16
1961
the Greek C o m m u n a l Chamber (Law N o . 16/61), is null and void and
no effect whatsoever". T h e assessment 107 1964 Nov.12 1965 March 2 1. THE REPUBLIC
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMISSIONER
INCOME TAX 2. THE GREEK COMMUNAL CHAMBER 1964 Nov. 12 1965 March2 IOANNIS PANAYIDES and I. THE REPUBLIC
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMISSIONER
INCOME TAX 2. THE GREEK COMMUNAL CHAMBER in question has been based on section 20
Schedule " A " to L a w 16/61 and paragraphs 1 and 2
the T a b l e
Rates
Taxation attached thereto, whereby, inter alia, a bachelor is made liable to pay personal tax 2 0 % in excess
what would otherwise have been paid b y him had he not been a bachelor. T h e issue before the Court to determine is whether the assessment in question on the Applicant whereby, by reason
his being a bachelor, he has been made liable to pay as personal tax an amount 2 0 % in excess
the amount which he would have otherwise paid if he had not been a bachelor, is permissible under the Constitution
Cyprus or whether such assessment, which makes a distinction between married and unmarried persons, contravenes any
the provisions
the Constitution. Held, I (a) It is not reasonable to make in Cyprus a distinction between married and unmarried persons in so far as the liability to pay personal tax,
the nature for which provision is made in Article 87
the Constitution, is concerned, nor does such a distinction have to be m a d e , in view
the intrinsic nature
things. (b) As such distinction, not being a reasonable one to make and not being one which has to be made in view
t h e intrinsic nature
the status
a bachelor, contravenes Article 28 and paragraph 1
the Constitution, and, therefore, the relevant legislative provision in question, namely, section 20
Schedule " A " to L a w 16/61 and paragraph 1 and 2
the T a b l e
Rates
Taxation attached thereto, are unconstitutional. Observation 1:- Although, in view
the conclusion reached in connection with Articles 28 and 24
the C o n stitution it has not become necessary to examine the provisions
paragraph 1
the Constitution, it might be observed that had the Court found that the making
a distinction for the purposes
personal taxation between married and unmarried persons had not contravened Articles 28 and 24
the Constitution, then it would have been for consideration whether the encouragement
marriage by the imposition
a personal tax on those who d o not marry does not, in fact, a m o u n t to an interference with the freedom
marriage which is safeguarded by paragraph 1
, inasmuch as it might be said 108 \ that those who do not marry were being penalised by taxation legislation on account
their failure to marry. Observation 2 : - It likewise becomes unnecessary to consider the submission
counsel for the Applicant concerning paragraph (f)
, but it might be o b served in this connection that sub-paragraph (a)(i)
paragraph 1
the Constitution does empower the Communal Chamber " t o direct policy within their communal laws". The Order: T h e assessment made on the Applicant, which was communicated to him by the letter
the C o m missioner
Income T a x dated 31st July, 1962, is null and void and
no effect whatsoever. Per TRIANTAFYLLIDES, J. (In supplementing ment
the Court) : the Judg-
this recourse and, also, with the conclusion reached therein, to the effect that the distinction between married and unmarried persons, in so far as the liability to the particular taxation is concerned, is not reasonable and, therefore, not valid in the sense
the Constitution.
this Constitution". Paragraph 2 makes provision about the law applicable— a matter with which we are not concerned in this Case.
the intrinsic 109 1964 Nov.12 1965 March2 IOANNIS PANAYIDES and 1. THE RFPUBLIC
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMISSIONER
INCOME TAX
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMISSIONER
INCOME TAX 2. THE GREEK COMMUNAL CHAMBER nature
things and as being divorced from the question
means, remains a provision which appears calculated to promote the institution
marriage. In view
the Constitution such a social policy can no longer be pursued by means
legislation. Nobody can be burdened with increased taxation by way
an inducement or compulsion to change his unmarried status into a married one. Otherwise, he is not "free to marry".
status between married and unmarried persons as a difference leading to the making
reasonable distinction on the basis
means, would also be treated as unconstitutional, as being contrary to Article 22. The matter would have to be determined when it arises,jf_at all, and in the meantime should be left entirely open.
taxation legislation enacted by a Communal Chamber under Article 87 (0(0·
Communal Chambers to pursue by means
such laws, in accordance with the purposes for which the competence to enact the said laws has been granted to Communal Chambers. The purpose for which the taxing powers have been granted to Communal Chambers is clearly to be found set out in Articles 87(i)(f) and 88
their expenditure. In my opinion, the pursuing
a social policy, as above, by means
taxation legislation, is far beyond the competence granted to the Communal Chambers in the matter. Assessment complained
declared null and void. Cases referred to: Mikrommatis and the Republic, (2 R.S.C.C. p. 125 at P- 130110 Recourse. Recourse against the assessment
income tax which has been made on the applicant as personal tax for the year 1961 by the Commissioner
Income Tax under Law 16of 1961of the Greek Communal Chamber. A. Hadjioannou for the applicant. M. Spanos, Counselof theRepublic,for Respondent No.1 G. Tornaritis, for Respondent No. 2. Cur.adv.vult. The following judgments were read: ZEKIA, P.: The judgment
the Court will be delivered by Mr. Justice Munir, and will be supplemented by Mr. Justice Triantafyllides. MUNIR, J.: By this recourse, which is made under Article 146
the Constitution, the Applicant seeks a declaration that "the decision or act
the Commissioner
Income Tax contained in the letter dated 31st July, 1962, with reference file No. 3516/6 and addressed to Applicant is null and void and
no whatsoever effect". The "decision or act" referred to in the Applicant's motion for relief is the assessment
tax which has been made on the Applicant as personal tax for the year 1961 by the Commissioner
Income Tax under Law 16of 1961
the Greek Communal Chamber (hereinafter referred to as "Law 16/61"). The assessment in question has been based on section 20
Schedule " A " to Law 16/61 and paragraphs 1 and 2
the Table
Rates
Taxation attached thereto, whereby, inter alia, a bachelor is made liable to pay personal tax 20% in excess
what would otherwise have been paid by him had he not been a bachelor. The Applicant in this Case isa bachelor and a manufacturer
shoe-polish, carrying on business in Nicosia. On the 30th June, 1962, the Commissioner
Income Tax, acting at the request
the Greek Communal Chamber, assessed the Applicant to pay the sum
£58.080, as personal tax for the year 1961 under Law 16/61, as amended by Law 8/62
the Greek Communal Chamber. On the 12th July, 1962, the Applicant wrote a letter to the Commissioner
Income Tax raising the unconstitutionality
the said assessment 111 1964 Nov.12 1965 March 2 IOANNIS PANAYIDES and 1. T H E REPUBLIC
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMISSIONER
INCOME TAX
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMISSIONER
INCOME TAX
Tax Payable under the said assessment was t :nclosed with the reply. The subr nissions made bycounsel for the Applicant may be summarisecI as follows:— (i) the assessment and the legislative provisions on which it was based, are contrary to Article 28
the Constitution, because no such discrimination between an unmarried and married person is permitted under Article 28
the Constitution, because that Article provides that every person must contribute towards the public burdens "according to his means'* and not according to his persona! status. The distinction, therefore, made in this respect between married and unmarried persons is unconstitutional; (iii) Article 22
the Constitution provides that "any person reaching nubile age is free to marry". The freedom to marry (or not to marry) has thus been recognized by the Constitution as one
the fundamental rights and liberties. It was submitted by counsel for the Applicant that the relevant provisions
Law 16/61, by placing an additional financial burden on unmarried persons, were thus interfering with the freedom
marriage and any such provision, therefore, contravened Article 22; (iv) the provisions
the said section 20
, and paragraphs 1 & 2
Schedule "A", to Law 16/61, in so far as they allow a distinction to be made between married and unmarried members
the Greek Community in relation to the imposition
personal taxation, are also contrary to Article 87
Law 16/61 112 was purporting to regulate social and economic policy such aswhether marriage should be encouraged or not as a matter
public policy, and it was submitted that the formulation
such policy belonged to the sphere
central administration and not to that
the Communal Chambers. The submissions
counsel for Respondent No. 1 and Counsel for Respondent No. 2 may be summarized as follows:— (a) The distinction made by Law 16/61 between married and unmarried persons is one to be found in the legal systems
many countries, with provisions in their constitutions similar to those
The main object
such distinction is to encourage marriage, and it is based on the right
the State to regulate its demographic structure; (b) inasmuch as the taxation imposed by the Communal Chamber by virtue
the Constitution is a "personal tax", the personal status
the person liable to pay such tax, such as his marital status, can properly be taken into account; (c) equality under Article 28
proportional equality and not arithmetical equality and in this connection reference was made to the Judgment
the Supreme Constitutional Court in the Case
Mikrommatis and the Republic, 2 R.S.C.C. p. 125, at p. 13I-. The distinction, therefore, between married and unmarried persons, it was submitted, did not contravene Article 28, because such persons do not belong to the same category and are not
equal status. Such a distinction was-thus based on reasonable criteria and was not discriminatory. (In this connection the following authorities were cited: Svohs-Vlachos, The Constitution
Greece
personal status under Law 16/61, intended, inter alia, to encourage marriage and such encouragement did not contravene Article 87
the Constitution and that the Greek Communal 113 1964 Nov. 12 1965 March 2 IOANNIS PANAYIDES and 1. THE REPUBLIC
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMISSIONER
INCOME TAX
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMISSIONER O F INCOME TAX 2. T H E GREEK COMMUNAL CHAMBER Munir, J. Chamber was expressly empowered by sub-paragraph (a)(i)
paragraph 1of Article 89 "to direct policy" ("determiner les principles directeurs"). The issue for this Court to determine iswhether the assessment in question on the Applicant whereby, by reason
his being a bachelor, he has been made liable to pay as personal tax an amount 20% in excess
the amount which he would have otherwise paid if he had not been a bachelor, is permissible under our Constitution or whether such assessment, which makes a distinction between married and unmarried persons, contravenes any
the provisions
the Constitution. It is not in dispute that this distinction between married and unmarried persons for purposes
Income Tax was first introduced into the income tax legislation
this country by the legislation which had existed prior to the establishment
the Republic. The form in which such provision existed in income tax legislation immediately before Independence may be found in paragraph 2
the Second Schedule to the Income Tax Law, Cap. 323. The relevant provisions
Law 16/61 has no doubt been modelled on the corresponding provision
Cap. 323. When this distinction between married and unmarried persons for income tax purposes was first made in this country over twenty years ago our Constitution was not,
course, in force at the time and the question
whether such a distinction is now permissible under our Constitution and in the present times requires careful examination in the light
the various relevant provisions
the Constitution, notwithstanding the fact that such a distinction, which is almost as old as the institution
income tax itself in this country, has been made for so many years and is not, therefore, a novel distinction in this country. The first provision
the Constitution to consider is Article 28, paragraphs 1 and 2
which read as follows:— " 1 . All persons are equal before the law, the administration and justice and are entitled to equal protection thereof and treatment thereby. 2. Every person shall enjoy all the rights and liberties provided for in this Constitution without any direct or indirect discrimination against any person on the ground 114 1
his community, race, religion, language, sex, political or other convictions, national or social descent, birth, colour, wealth, social class,or on any ground whatsoever, unless there is express provision to the contrary in this Constitution". 1964 Nov. 12 1965 March 2 IOANNIS PANAYIDES and There can be no doubt that a distinction has been made between married persons, on the one hand, and unmarried persons, on the other, by the provisions in question
Law 16/61 but the question is whether such distinction on account
personal status amounts to the kind
"direct or indirect discrimination" which it is intended to prevent by paragraph 2
. In this connection it is useful to quote in full a passage from the Judgment
the Supreme Constitutional Court in the Case
Mikrommatis and the Republic, 2 R.S.C.C. p. 125at p. 131,bearing on this point, which reads as follows:— "In the opinion
the Court the term 'equal before the law* in paragraph 1
does not convey the notion
exact arithmetical equality but it safeguards only against arbitrary differentiations and does not exclude reasonable_distinctions which have to be made in view "
the intrinsic nature
things. Likewise, the term 'discrimination' in paragraph 2
The question which thus arises is whether the distinction which has been made in this matter between married and unmarried persons is a "reasonable distinction''' which has been made in view
the intrinsic nature.
things and whether such distinction is just and proper. The same considerations apply to the interpretation
paragraph 1
the Constitution, which reads as follows:— "I. Every person is bound to contribute according to his means towards the public burdens". In the Mikrommatis Case, cited above, the Supreme Constitutional Court again, at p. 131, stated that the view set out in the above-quoted passage from that Case "regarding the application
the principle
equality applies also to the interpretation
paragraph 1
". Applying this principle
"reasonable distinctions which 115 1. T H F REPUBLIC
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMISSIONER
INCOME TAX
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMISSIONER
INCOME TAX 2. T H E GREEK COMMUNAL CHAMBER Munir, J. have to be made in view
the intrinsic nature
things", the Supreme Constitutional Court in the Mikrommatis Case went on to hold "that reasonable distinctions in taxation legislation between married and unmarried persons do not in principle
fend against paragraphs 1 or 2
What we now have to consider in this case is whether, having regard to "the intrinsic nature
things", it was reasonable, for the purpose
the imposition
personal taxation by the Greek Communal Chamber under paragraph (!)(/}
the Constitution on members
the Greek Community, for the Greek Communal Chamber to make a distinction between married and unmarried members
this Community. If the making
such a distinction for the purposes
such personal taxation was, in all the circumstances, a reasonabledistinction to make then in the opinion
this Court, such a distinction would not amount to "discrimination" in the sense
the Constitution nor would it contravene the provisions
paragraph I
the Constitution, but if it was not reasonable to make such a distinction then the contrary would be the case. Coming now to the specific question whether the making
such a distinction between married and unmarried persons in this respect was reasonable, the first point to consider is whether, having regard to the circumstances and conditions prevailing in Cyprus, and particularly having regard to the customs and traditions
the particular Community
the Communal Chamber which has imposed such personal taxation, it is reasonable to assume that a bachelor is in fact in a more advantageous position financially, all other relevant things being equal, than a married person
the same social and economic class as such bachelor. It is true that when a bachelor gets married he assumes added financial responsibilities towards his wife and children and, to that extent, it may be said that a married man's financial obligations are thus greater than a bachelor's. This distinction may more readily appear reasonable in certain countries where an unmarried man is not expected to have any financial or other obligations towards his family, such as in the case
those countries where as soon as a young man comes
age he probably leaves home and probably severs all financial and other ties with his parents' family. It is well known, how116 ever, that in Cyprus, and particularly amongst the Greek Community, an unmarried man is expected by custom and tradition to undertake financial obligations not only towards his parents (which is also a legal obligation) but also towards the members
his family and in particular towards his unmarried sisters, and there are
ten instances where a young man may find that he is not in a financial position to marry, and is not expected to do so, until his sisters have been settled in marriage. Furthermore, the unreasonableness
the distinction might be illustrated by considering the extreme case
a bachelor and a person whose wife dies, for example, the day after their marriage. Could it be said that it would be reasonable to make a distinction, for the purposes
the personal taxation in question, between a.bachelor and such a widower? The answer must
course in the Court's view be in the negative. It should also be observed that the provisions in the Law in question allowing deductions to be made in respect
the wife and children
a married man already appear to make adequate allowance for the added financial burden
a person who is responsible for maintaining a family and bring ing up his children. Having thus made this allowance for a married man, it seems unreasonable to discriminate further between married and unmarried persons by imposing an increased rate
taxation on unmarried persons. In these circumstances the Court is
the opinion that it i> not reasonable to make in Cyprus a distinction between married and unmarried persons in so far as the liability to pay personal tax,
the nature for which provision is made in Article 87
the Constitution, is concerned, nor does such a distinction have to be made, in the Court's opinion, in view
the intrinsic nature
things. The Court is, therefore,
the opinion that as such distinc tion, not being a reasonable one to make and not being one" which has to be made in view
the intrinsic nature οΐ the status
a bachelor, contravenes Article 28 and paragraph I
the Constitution, and, therefore, the relevant legislative provision in question, namely, section 20
Sche dule "A" to Law 16/61 and paragraphs 1and 2
the Table
Rates
Taxation attached thereto, are unconstitutional. 117 1964 Nov. 12 1965 March 2 IOANNIS PANAYIDES and 1. T H E REPUBLIC
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMIS SIONER
INCOME TAX
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMISSIONER
INCOME TAX 2. T H E GREEK COMMUNAL CHAMBER Munir, J. Although, in view
the conclusion reached in connection with Articles 28 and 24
the Constitution it has not become necessary to examine the provisions
paragraph 1
the Constitution, it might be observed that had the Court found that the making
a distinction for the purposes
personal taxation between married and unmarried persons had not contravened Articles 28 and 24
the Constitution, then it would have been for consideration whether the encouragement
marriage by the imposition
a personal tax on those who do not marry does not, in fact, amount to an interference with the freedom
marriage which is safeguarded by paragraph 1of Article 22, inasmuch as it might be said that those who do not marry were being penalised by taxation legislation on account
their failure to marry. It likewise becomes unnecessary to consider the submission
counsel for the Applicant concerning paragraph (f)
, but it might be observed in this connection that sub-paragraph (a) (/')
paragraph 1
the Constitution does empower the Communal Chamber "to direct policy within their communal laws". For all the reasons given above the Court is
the opinion that the assessment in question made on the Applicant, which was communicated to him by the letter
the Commissioner
Income Tax dated 31st July, 1962, is null and void and
no effect whatsoever. TRIANTAFYLLIDHS, J.: In this Case, 1have had the benefit
reading the Judgment
my brother Judge Mr. Justice Munir and I agree with the result
this recourse and, also, with the conclusion reached therein, to the effect that the distinction between married and unmarried persons, in so far as the liability to the particular taxation is concerned, is not reasonable and, therefore, not valid in the sense
. I felt it, however, necessary to deal further with two points touched upon in the said Judgment, viz. the relationship between such distinction and Articles 22 and 87
the Constitution. Article 22, paragraph 1, provides: "Any person reaching nubile age is free to marry and to found a family according to the law relating to marriage, applicable to such person under the provisions
this Constitution". Paragraph 2 118 makes provision about the law applicable—a matter with which we are not concerned in this Case. In my opinion, the right to marry, which has been expressly safeguarded as a Fundamental Right and Liberty, necessarily implies the converse, i.e.'the right not to marry. Nobody can befree todo something unless he is alsofree not to do it. Thedistinction between married and unmarried persons under consideration in this Case,having already beenfound not to be reasonable, in the light
the intrinsic nature
things and as being divorced from the question
means, remains a provision which appears calculated to promote the institution
marriage. In view
the Constitution such a social policy can no longer be pursued by means
legislation. Nobody can be burdened with increased taxation by way
an inducement or compulsion to change his unmarried status into a married one. Otherwise, he is not "free to marry". 1 would add, however, that nothing in this Judgment is intended to lay down that taxation legislation properly treating the difference
status between married and unmarried persons as a difference leading to the making
reasonable distinction on the basis
means, would also be treated as unconstitutional, as being contrary to Article 22. The matter would have to be determined when it arises, if at all, and in the meantime should be left entirely open. A social policy, such as above, cannot in any ease be pursued, in my opinion, by means
taxation legislation enacted by a Communal Chamber under Article 87(I) (/'). It is correct that, under Article 89
Communal Chambers to pursue by means
such laws, in accordance with the purposes for which the competence to enact the said laws has been granted to Communal Chambers. The purpose for which the taxing powers have been granted to Communal Chambers is clearly to be found set out in Articles 87
their expenditure. In 119 1964 Nov. 12 1965 March 2 IOANNIS PANAYIDES and 1. THE REPUBLIC
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMISSIONER
INCOME TAX
CYPRUS THROUGH (a) THE MINISTER
FINANCE (b) THE COMMISSIONER
INCOME TAX 2. T H E GREEK COMMUNAL CHAMBER my opinion, the pursuing
a social policy, as above, by means
taxation legislation, is far beyond the competence granted to the Communal Chambers in the matter. Assessment complained
declared null and void. No order as to costs. Triantafyllides, J. 120
AI explanation based on the official legal text. Indicative, not a substitute for legal advice.