A chilling account: North American and Australasian approaches to fears of overdefensive responses to taxpayer claims against tax officials

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Abstract

Judges frequently deny relief to taxpayers in claims against tax officials because of concerns about the possible adverse motivational effects on tax officials of imposing liability. In particular, there is a concern that the fear of being sued will result in tax officials becoming over-defensive in carrying out their tax administration duties. These over-defensive behaviours are often described as 'chilling' effects or 'chill-factor' concerns. The inherent logical appeal of these chill-factor concerns is rarely subjected to the rigours of the rules of evidence or even to close academic scrutiny. Further, no attempt has been made to devise robust legal principles for appropriate judicial treatment of chill-factor concerns. This article addresses these deficiencies. Specifically, Part 2 explains the main controversies surrounding the existence, nature and most appropriate weight to be afforded to chill-factor concerns in taxpayer claims against tax officials. Part 3 examines the judicial treatment of chill-factor concerns in taxpayer claims against tax officials in the United States, Canada, Australia, and New Zealand. Part 4 draws on the various approaches in each of these jurisdictions and, mindful of the controversies and complexities discussed in Part 2, sets out a series of guidelines to assist policy-makers and judges in determining the appropriate treatment of chill-factor policy concerns in taxpayer claims against tax officials.

Original languageEnglish
Pages (from-to)262-279
Number of pages18
JournaleJournal of Tax Research
Volume13
Issue number1
Publication statusPublished - 1 Jan 2015
Externally publishedYes

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