Recent news article on Australian "micro-nations"

Prince Paul denies he pays his rates - he merely offers a "grant" to support art in the community.

http://news.sky.com/skynews/Home/World-News/Australia-Despite-many-Wanting-To-Do-Away-With-Monarchy-Some-Aussies-Starting-Micro-Nations/Article/201005415636741

It makes them sound like deluded fools.

The entire article is fluff. It doesn't get to the nitty gritty about taxes/laws/resources/etc that I particularly would want to know about.

The Prinicipality of Hutt River posted their tax return on their website. The stated taxable income is $0. They are declared "non-residents" for tax purposes. Which means essentially they get taxed at the highest rate.

http://www.principality-hutt-river.com/Principality%20Downloads/Copy%20of%20HRHPL_ATO.pdf

It also says this on the ATO's website:

The Australian Government does not legally or otherwise recognise the so-called ‘Hutt River Province’.

http://www.ato.gov.au/atp/content.asp?doc=/content/62019.htm

So.... I don't get how this works. Is it just some kind of ploy? From what I have heard, there appears to be no practical benefit in micro-nations.