In the recent Fortescue decision, the High Court made some interesting observations regarding interpretation of the word ‘discrimination’ in the context of the Federal Government's power with respect to taxation in s 51(2) of the Australian Constitution. Coincidentally, the Federal Government has commenced consideration of options for the development of northern regions of Australia. Of course, one option would be to introduce a variable taxation system to encourage businesses and individuals to be based, and/or invest, in northern Australia. This article considers possible constitutional issues associated with variable taxation schemes overtly favouring businesses and individuals based in the ‘north’, given the recent High Court decision.