Concepcion Vidal de Roces and her husband, Marcos Roces , and Elvira Vidal de Richards, plantiffs and appellants,

vs. Juan Posadas, Jr., Collector of Internal Revenue, defendant and appellee Facts : The plaintiff herein brought this action to recover from the defendant, Collector of Internal Revenue, certain sums of money paid by them under protest as inheritance tax. They appealed from the judgment rendered by the Court of First Instance (CFI of !anila dismissing the action, "ithout cost. #n !arch $% and $&, $'&(, )speran*a Tua*on, by means of public documents, donated certain parcels of land, situated in !anila to the plaintiffs herein, "ho, "ith their respective husbands accepted them in the same public documents, "hich "ere duly recorded in the registry of deeds. #n +an. (, $'&,, the donor died in the City of !anila "ithout leaving any forced heir and in her "ill "hich "as admitted to probate. -fter the estate had been distributed among the instituted legatees and before the delivery of their respective shares, the appellee herein, as Collector of Internal Revenue, ruled that the appellants, as donees and legatees, should pay as inheritance tax the sums of . $,,,/0.%% and . $0,'($.1( respectively. #f these sums . $(,$'$.12 "as levied as tax on the donation to Concepcion 3idal de Roces and . $, 1,&.(% on her legacy, and, li4e"ise, . $&,022.'( "as imposed upon the donations made to )lvira 3idal de Richards and . $,1,&.(% on her legacy. -t first the appellants refused to pay the aforementioned taxes but, at the insistence of the appellee and in order not to delay the adjudication of the legacies, they agreed at last, to pay them under protest. The appellee filed a demurrer to the complaint on the ground that the facts alleged therein "ere not sufficient to constitute a cause of action. The court sustained the demurrer and ordered the amendment of the compliant "hich the appellant failed to do, "hereupon the trial court dismissed the action on the ground that the aforementioned appellants did not really have aright of action. The judgment appealed from "as based on the provisions of 5ection $(1% of the Revised -dministrative Code "hich reads as follo"s6 Sec. !"#. $dditions of %ifts and advances 7 -fter the aforementioned deductions have been made, there shall be added to the resulting amount the value of all gifts or advances made by the predecessor to any of those "ho, after his death, shall prove to be his heirs, devisees, legatees or donees mortis causa. The appellee also contends that the "ords 8all gifts9 refer clearly to donations inter vivos. Issue: $. :hether or not the 5ection $(1% of the Revised -dministrative Code does not include donations inter vivos "hich the appellants contended and if it does, it is unconstitutional, null and void for the reasons that the ;egislature has no authority to impose inheritance tax on donations inter vivos< and because a legal provision of this character contravenes the fundamental rule on uniformity of taxation= &. :hether or not the interpretation of the CFI is in conflict "ith the rule laid do"n in the case of Tuason and Tuason vs. .osadas= &eld: $. >o. The gifts referred to in 5ection $(1% of the Revised -dministrative Code are those donations inter vivos that ta4e effect immediately or during the lifetime of the donor but are made in consideration or in contemplation of death. ?ifts inter vivos, the transmission of "hich is not made in contemplation of the donor@s death should not be understood as

included "ithin the said legal provision for the reason that it "ould amount to imposing a direct tax on property and not on transmission thereof. -lso, it can be inferred from the allegations of the complaint par. & and / that said donations inter vivos "ere made in consideration of the donor death. The Court referred to the allegations that such transmissions "ere effected in the month of !arch $'&(, that the donor died in +anuary $'&,, and that the donees "ere instituted legates in the donor@s "ill "hich "as admitted to probate. It is from these allegations, that the Court inferred a presumption juris tantum that said donations "ere made mortis causa and, as such, are subject to the payment of inheritance tax. $uthorit' of the (e%islature The tax collected by the appellee on the properties donated in $'&( really constitutes an inheritance tax imposed on the transmission of said properties in contemplation or in consideration of the donor@s death and under the circumstance that the donees "ere later instituted as the former@s legatees. For this reason, the la" considers such transmission in the form of gifts inter vivos, as advances on inheritance and nothing therein violates any constitutional provision, inasmuch as said legislation is "ithin the po"er of the ;egislature. Principle of )nifor*it' The appellants Auestioned the po"er of the ;egislature to impose taxes on the transmission of real estate that ta4es effect immediately and during the lifetime of the donor to pay the tax, another inter vivos "ho did not prove to be an heir, a legatee, or a donee mortis causa of the predecessor, "ould be exempt from such a tax. But these are t"o different cases< the principle of uniformity is inapplicable to them. -lso, in the case of Tuason and Tuason, it "as also held that 5ection $(1% of the Revised -dministrative Code did not violate the constitutional provision regarding uniformity of taxation. It cannot be null and void on this ground because it eAually subjects to the same tax all of those donees "ho later become heirs, legatees or donees mortis causa by the "ill of the donor. There "ould be a repugnant and arbitrary exception if the provisions of the la" "ere not applicable to all donees of the same 4ind. &. >o. The Cigh Court ruled that their interpretation of the la" is not conflict "ith the rule laid do"n in the case of Tuason and Tuason vs. .osadas. The Tuason case, as the Court said that the expression 8all gifts9 refers to gifts inter vivos inasmuch as the la" considers them as advances on inheritance, in the sense that they are gifts inter vivos made in contemplation or in consideration of death. In Tuason case, it "as not held that that 4ind of gifts consisted in those made completely independent of death or "ithout regard to it. :herefore, the judgment appealed from is hereby affirmed "ith cost of this instance against the appellants. .roperty 5ubject to Inheritance Tax. The inheritance tax ordinarily applies to all property "ithin the po"er of the state to reach passing by "ill or the la"s regulating intestate succession or by gift inter vivos in the manner designated by statute, "hether such property be real or personal, tangible or intangible, corporeal or incorporeal.