In taxation, no limit as to amount while license fee limited to cost of the license and the expenses of

police surveillance and regulation.

d. Time of payment: Taxes normally paid after commencement of business while
license fee before. e. Effect of payment: Failure to pay a tax does not
make the business illegal while failure to pay license fee makes business illegal. f.
Surrender: Taxes, being the lifeblood of the state, cannot be surrendered except for lawful
consideration while a license fee may be surrendered with or without consideration. (Cooley on Taxation,
pp. 1137-1138; Pacific Commercial Company v. Romualdez, et al., 49 Phil. 924)

8. How may the power to tax be utilized to carry out the social justice program
of our government ? SUGGESTED ANSWER: The compensatory
purpose of taxation is to implement the social justice provisions of the constitution through the
progressive system of taxation, which would result to equal distribution of wealth, etc.

Progressive income taxes alleviate the margin between rich and poor. (Southern Cross
Cement Corporation v. Cement Manufacturers Association of the Philippines, et al., G. R. No. 158540, August 3, 2005)

In recent years, the increasing social challenges of the times expanded the scope of the
state activity, and taxation has become a tool to realize social justice and the equitable
distribution of wealth, economic progress and the protection of local industries as well as public
welfare and similar objectives. (Batangas Power Corporation v. Batangas City, et al., G. R. No. 152675,
and companion case, April 28, 2004 citing National Power Corporation v. City of Cabanatuan, G. R. No. 149110, April
9, 2003)