TAXATION 1 Case Doctrines

Batch 1
PLANTERS PRODUCTS, INC. vs. FERTIPHIL
CORPORATION. An inherent limitation on the power of
taxation is public purpose. Taxes are exacted only for a public
purpose. They cannot be used for purely private purposes or
for the exclusive benefit of private persons. The power to tax
exists for the general welfare; hence, implicit in its power is
the limitation that it should be used only for a public purpose.
It would be a robbery for the State to tax its citizens and use
the funds generated for a private purpose.
SISON vs. ANCHETA. Due process, equal protection, and
uniformity in taxation.
It is undoubted that the due
process clause may be invoked where a taxing statute is so
arbitrary that it finds no support in the Constitution.
Favoritism and undue preference cannot be allowed. For the
principle is that equal protection and security shall be given
to every person under circumstances which if not identical
are analogous. According to the Constitution: "The rule of
taxation shag be uniform and equitable."
PASCUAL v. THE SECRETARY OF PUBLIC WORKS AND
COMMUNICATIONS, ET AL. It is a general rule that the
legislature is without power to appropriate public revenues
for anything but a public purpose. . . . It is the essential
character of the direct object of the expenditure which must
determine its validity as justifying a tax and not the
magnitude of the interests to be affected nor the degree to
which the general advantage of the community, and thus the
public welfare, may be ultimately benefited by their
promotion. Incidental advantage to the public or to the state,
which results from the promotion of private interests, and the
prosperity of private enterprises or business, does not justify
their aid by the use of public money."
VIDEOGRAM REGULATORY BOARD v. CA. "The public
purpose of a tax may legally exist even if the motive which
impelled the legislature to impose the tax was to favor one
industry over another."

PETRON CORPORATION vs. PETILLA. The legislative

taxing power includes the authority: a. to determine the
nature, object, extent, coverage, and situs of the tax
imposition, b. to grant tax exemptions or condonations, and
c. to specify or provide for the administrative, as well as
judicial remedies that either the government or the
taxpayers may avail themselves of in the proper
implementation of the tax measure.
GEROCHI v. DEPARTMENT OF ENERGY. If generation of
revenue is the primary purpose and regulation is merely
incidental, the imposition is a tax; but if regulation is the
primary purpose, the fact that revenue is incidentally raised
does not make the imposition a tax.
MACEDA vs. MACARAIG, JR. "A taxpayer may question the
legality of a law or regulation when it involves illegal
expenditure of public money."
CIR V. LINGAYEN GULF. Uniformity requires that all subjects
or objects of taxation similarly situated are to be treated alike
or put on equal footing both in privileges and liabilities.
EASTERN THEATRICAL CO. v. ALFONSO. Equality and
uniformity in taxation means that all taxable articles or kinds
of property of the same class shall be taxed at the same rate.
The taxing power has the authority to make reasonable and
natural classifications for purposes of taxation; and the
theater companies cannot point out what places of
amusement taxed by the ordinance do not constitute a class
by themselves and which can be confused with those not
included in the ordinance. The fact that some places of
amusement are not taxed while others, like the ones herein,
are taxed is no argument at all against the equality and
uniformity of the tax imposition.
REYES VS. ALMANZOR. Taxes are lifeblood of government,
however, such collection should be made in accordance with
the law and therefore necessary to reconcile conflicting
interests of the authorities so that the real purpose of

taxation, promotion of the welfare of common good can be

achieved.

the Tariff and Customs Code which authorized the President

to issue the said EOs.

BRITISH AMERICAN TOBACCO v. CAMACHO. The

imposition of excise tax on cigarettes does not violate the
constitutional requirement of uniformity in taxation.

HERRERA v. QC BOA APPEALS. Important principles in tax

exemption of properties:

GARCIA VS. EXECUTIVE SECRETARY. Under Section 24,

Article VI of the Constitution, the enactment of appropriation,
revenue and tariff bills, like all other bills is, of course, within
the province of the Legislative rather than the Executive
Department. It does not follow, however, that therefore
Executive Orders Nos. 475 and 478, assuming they may be
characterized as revenue measures, are prohibited to be
exercised by the President, that they must be enacted
instead by the Congress of the Philippines. There is thus
explicit constitutional permission to Congress to authorize
the President subject to such limitations and restrictions as
[Congress] may impose to fix within specific limits tariff
rates . . . and other duties or imposts . . . . In this case, it is

a. Exemption of religious, charitable and educational

institutions apply to real property tax only. The test is usage,
not ownership.
b. The exemption extends to facilities which are incidental to
and reasonably necessary for the accomplishment of said
purposes, such as school for training nurses, nurses' home,
and recreational facilities.
LUNG CENTER v. QC. Exemption from real property tax is
not absolute; as when they lease their real property to
private entities as these are not the actual, direct and
exclusive used contemplated by law.