LIMITATIONS TO TRADE UNIONS’ USE OF REPRESENTATIVE ACTION TO INTERVENE IN TAX LITIGATION FOR TAX LIABILITIES OF ITS MEMBERS: A LEGAL APPRAISAL

Abstract

An action based on tax assessment under Pay-As -You -Earn (PAYE) Scheme cannot be maintained in arepresentative capacity. This is the reason for the resistance to every move as a group to challenge a taxassessment by the relevant tax authority. Trade Unions have always relied on the omnibus consent and authorityof members implied in their membership, to represent them in tax matters. They have always shown in itsinsistence that PAYE tax matters are matters relating to and connected to the welfare of workers who aremembers. They allege that it is part of the mandate of a trade union to stand in on behalf of persons so affectedwho are members, whether it is procedurally permitted or not. PAYE scheme is a tax scheme through whichemployees are assessed, re-assessed and demand notice sent to them and where the employers fail to remit theirtax indebtedness litigation to recover same by the tax authority will be the next option. Doctrinal method of datacollection was adopted using analytical approach to review the various tax statues, decisions of courts, opinionof experts and journal and internet materials on the subject matter. The work revealed that liability to tax arisesonly upon an earned income of an individual tax payer. An assessment or re-assessment of tax liability for allemployees could not be made in a common exercise by the tax authority. The salaries of workers are not from acommon fund liable to income tax en bloc. It is recommended that each and every employee has a separate anddistinct cause of action which could not be combined in one cause. The cause of action in tax matters or againstan assessment accrues only when the individual person, employer or tax payer was assessed.