CIR VS ALGUE FACTS: Private respondent Algue, a domesti orporation engaged in engineering, onstru tion and ot!

er allied a tivities, re eived a letter "rom petitioner assessing it in t!e total amount o" P#$, %#$&#' as delin(uen ) in ome ta*es "or )ears %+'# and %+'+& Algue "iled a letter o" protest or re(uest "or re onsideration& T!e protest ,as denied -) petitioner -ut ,as reversed -) t!e CTA& Petitioner ontends t!at t!e laimed dedu tion o" P.',/// ,as properl) disallo,ed -e ause it ,as not an ordinar), reasona-le or ne essar) -usiness e*penses -ut rat!er personal !olding ompan) in ome& 0n t!e ot!er !and, Algue argued t!at said amount !ad -een legitimatel) paid -) it "or t!e a tual servi es rendered in t!e "orm o" promotional "ees& T!ese ,ere olle ted "or t!eir ,or1 in t!e reation o" t!e Vegeta-le 0il Investment Corporation and su-se(uent a (uisition o" t!e P!ilippine Sugar Estate 2evelopment Compan)& ISSUE: 3!et!er or not t!e disallo,an e ,as proper& 4EL2: 5o, it ,as not proper& It is said t!at ta*es are ,!at ,e pa) "or ivili6ation so iet)& 3it!out ta*es, t!e government ,ould -e paral)6ed "or la 1 o" t!e motive po,er to a tivate and operate it& 4en e, despite t!e natural relu tan e to surrender part o" one7s !ard earned in ome to t!e ta*ing aut!orities, ever) person ,!o is a-le to must ontri-ute !is s!are in t!e running o" t!e government& T!e government "or its part, is e*pe ted to respond in t!e "orm o" tangi-le and intangi-le -ene"its intended to improve t!e lives o" t!e people and en!an e t!eir

moral and material values& T!is s)m-ioti relations!ip is t!e rationale o" ta*ation and s!ould dispel t!e erroneous notion t!at it is an ar-itrar) met!od o" e*a tion -) t!ose in t!e seat o" po,er& 8ut even as ,e on ede t!e inevita-ilit) and indispensa-ilit) o" ta*ation, it is a re(uirement in all demo rati regimes t!at it -e e*er ised reasona-l) and in a ordan e ,it! t!e pres ri-ed pro edure& At t!e ase at -ar, t!e private respondent !as proved t!at t!e pa)ment o" t!e "ees ,as ne essar) and reasona-le in t!e lig!t o" t!e e""orts e*erted -) t!e pa)ees in indu ing investors and prominent -usinessmen to venture in an e*perimental enterprise and involve t!emselves in a ne, -usiness re(uiring millions o" pesos& T!is ,as no mean "eat and s!ould -e, as it ,as, su""i ientl) re ompensed&

TAX VS LICENSE AND REGULATORY FEE

nonet!eless remains su-Ce t o" t!e s rutin) o" t!e C0A& As su !, t!e "und olle ted is not in t!e pure e*er ise o" t!e ta*ing po,er& It is levied ,it! a regulator) purposeB to provide a means "or t!e sta-ili6ation o" t!e oil industr)& T!e lev) is in t!e e*er ise o" t!e poli e po,er o" t!e State& PAL VS E2U

0smena vs 0r-os FACTS: T!e t!en President 9ar os issued on 0 to-er %/, %+#: P&2& %+#; reating a Spe ial A ount in t!e General Fund, designated as t!e 0il Pri6e Sta-ili6ation Fund <0PSF=& T!e "und is intended "or reim-ursements to oil ompanies "or ost in reases in rude oil and imported petroleum& Su-se(uentl), t!e 0PSF ,as re lassi"ied into a >trust lia-ilit) a ount? and it ,as also aut!ori6ed t!e investment o" t!e "und in government se urities& T!e petitioner no, !allenges t!e onstitutionalit) o" t!e "und as ,ell as its dis-ursements ontending t!at it violates Se tion @: <$=, Arti le VI o" t!e Constitution& It ontends t!at t!e mone) olle ted s!all -e maintained in a spe ial a ount o" t!e general "und -e ause t!e) are, supposedl), ta*es levied "or a spe ial purpose& ISSUE: 3!et!er or not t!e "unds o" 0PSF ,ere olle ted -) virtue o" t!e StateAs po,er o" ta*ation& 4EL2: 5o, it does not parta1e o" t!e nature o" ta*ation po,er o" t!e State& Alt!oug! it seems lear t!at ,!ile t!e "unds olle ted ma) -e re"erred to as ta*es, t!e) are e*a ted in t!e e*er ise o" t!e poli e po,er o" t!e State& 9oreover, t!e 0PSF is indeed a spe ial as it sis segregated "rom t!e general "undB and ,!ile it is pla ed in ,!at t!e la, re"er to as >trust lia-ilit) a ount?, t!e "und

Fa ts: PAL, a registered orporation in air transportation -usiness, is e*empt "rom t!e pa)ment o" ta*es, in luding motor ve!i le "ees& In %+.%, appellee Commissioner Edu issued a regulation re(uiring all ta* e*empt entities, among t!em PAL to pa) motor ve!i le registration "ees& PAL t!us paid, under protest, t!e amount o" P!p %+, '@+&.' as registration "ees o" its motor ve!i les& PAL argued t!at motor ve!i le registration "ees are in realit) ta*es "rom t!e pa)ment o" ,!i ! PAL is e*empt -) virtue o" its legislative "ran !ise& 0n t!e ot!er !and, Edu ontended t!at t!e "ees are regulator) e*a tions and not revenue measures, and t!ere"ore, do not ome ,it!in t!e e*emption granted to PAL& ISSUE: 3!et!er or not t!e motor ve!i le registration "ees are in t!e nature o" ta*& 4EL2: Des, it is in t!e nature o" ta*& I" t!e purpose is primaril) revenue, or i" t!e revenue is, at least, one o" t!e real and su-stantial purposes, t!en t!e e*a tion is properl) alled a ta*& Su ! is t!e ase o" motor ve!i le registration "ees& As appeared in t!e Land Transportation Code, it is patent "rom t!ere"rom t!at t!e legislators !ad in mind a regulator) ta* as t!e la, re"ers to t!e imposition as a >ta* or a "ee?& It is (uite apparent t!at t!e ve!i le registration "ees ,ere originall) simple e*a tions intended onl) "or regulator) purposes in t!e e*er ise o" t!e

StateAs poli e po,er& 0ver t!e )ears, !o,ever, as ve!i ular tra""i e*ploded in num-er and motor ve!i les -e ame a-solute ne essities, Congress !ad "ound t!e registration o" ve!i les a ver) onvenient ,a) o" raising mu ! needed revenues& T!eir nature t!en !as -e ome t!at o" ta*es& PR0GRESSIVE 2EVEL0P9E5T C0RP0RATI05 VS EUEF05 CITD FACTS: Cit) Coun il o" Eue6on Cit) adopted 0rdinan e 5o& .++., series o" %+;+, or t!e 9ar1et Code o" Eue6on Cit) ,!i ! provides, among ot!ers, t!at privatel) o,ned and operated pu-li mar1ets s!all pa) %/G o" t!e gross re eipts o" stall rentals as supervision "ee& Said ordinan e ,as amended and redu ed t!e "ee to 'G& 5o,, petitioner assails t!e validit) o" t!e ordinan e on t!e ground t!at su ! "ees are in realit) ta*es on in ome ,!i ! ,as pro!i-ited -) A t 5o& @@;:& ISSUE: 3!et!er or not t!e ta* imposed on gross re eipts o" stall rentals is an in ome ta* or a li ense "ee& 4EL2: T!e imposition is a li ense "ee& T!e term >ta*? "re(uentl) applies to all 1inds o" e*a tions o" monies ,!i ! -e ome pu-li "unds& 4o,ever, li ense "ee is a legal on ept distinguis!a-le "rom ta*B t!e "ormer is imposed in t!e e*er ise o" t!e poli e po,er o" t!e State "or purposes o" regulation, ,!ile t!e latter is imposed under t!e ta*ing po,er "or purposes o" raising revenues& To -e onsidered a li ense "ee, t!e imposition (uestioned must relate to an o upation or a tivit) t!at so engages t!e pu-li interests <!ealt!, sa"et), morals and ot!ers= as to re(uire regulation "or t!e prote tion and promotion o" su ! pu-li interest& At t!e ase at -ar, privatel) o,ned mar1et o" petitioner -eing a pu-li mar1et in t!e

sense o" a mar1et open and inviting t!e pu-li is re(uired a li ense issued -) respondent Cit), t!e issuan e o" ,!i ! ,as done primaril) in t!e e*er ise o" respondentAs poli e po,er& Su ! mar1et is esta-lis!ed "or t!e rendition o" servi e to t!e pu-li ,!i ! ,arrants lose supervision and ontrol -) t!e respondent Cit)& T!us, t!e 'G ta* imposed onstitutes a li ense "ee "or t!e regulation o" -usiness in ,!i ! petitioner engaged&

C09PA5IA GE5ERAL 2E TA8AC0S VS CITD 0F 9A5ILA FACTS: Petitioner, also 1no,n as Ta-a alera, "iled an a tion to re over "ormt !e Cit) o" 9anila t!e sum o" P4P %', @#/&// allegedl) overpaid -) it as ta*es on its ,!olesale and retail sales o" li(uor "rom %+':H%+'.& As a dul) li ensed "irst lass li(uor dealer, it paid t!e Cit) t!e "i*ed li ense "ees pres ri-ed -) 0rdinan e 5o, $$'#& Also, as a ,!olesale and retail dealer o" general mer !andi6e , it paid t!e sales ta* re(uired -) 0rdinan es 5o& $;$:, $$/% and $#;%& Ta-a aleraAs a tion "or re"und is -ased on t!e t!eor) t!at, in onne tion ,it! its li(uor sales, it s!ould onl) pa) t!e li ense "ee and not t!e muni ipal sales ta*B and sin e it alread) paid t!e li ense "ees, t!e sales ta* paid -) it is an overpa)ment and !en e re"unda-le& ISSUE: 3!et!er or not t!ere is overpa)ment o" ta*es -) Ta-a alera& 4EL2: PetitionerAs ontention is not tena-le& Li ense "ee is di""erent "rom ta*B t!e "ormer is imposed in t!e e*er ise o" t!e poli e po,er o" t!e state "or t!e purpose o" regulation, ,!ile t!e latter is imposed under t!e po,er o" ta*ation "or t!e purpose o" revenueHraising& 0rdinan e 5o $$'# learl) imposes a a li ense "ee

"or t!e privilege to engage in t!e -usiness selling li(uors& T!e li ense "ee is "or purposes o" regulation& 0n t!e ot!er !and, t!e ot!er t!ree ordinan es impose ta* on t!e sales o" general mer !andi6e <in luding li(uor=& 3it! t!is, t!at Ta-a alera is -eing su-Ce ted to dou-le ta*ation is more apparent t!an real& It is ,ell settled in t!is Curisdi tion t!at -ot! li ense "ee and a ta* ma) -e imposed on t!e same -usiness or o upation or "or selling t!e same arti le, t!is is not -eing in violation on t!e rule on dou-le ta*ation& T!us, Ta-a aleraAs ontention !as no merit&

t!at no -ene"it a rues to t!e propert) o,ners pa)ing assessment or t!e pro eeds misapplied, t!en t!e aut!orit) to insist pa)ment ease& ISSUE: ,!et!er or not t!e de"endantAs nonHpa)ment o" spe ial assessments Custi"ia-le& 4EL2: 5o, t!eir ontention !olds no ,ater& T!e spe ial assessment at -ar is not so mu ! o" an e*er ise o" t!e po,er o" ta*ation -ut t!e e*er ise o" t!e poli e po,er "or t!e general ,el"are o" t!e entire ountr)& It is, t!ere"ore, an e*er ise o" t!e sovereign po,er ,!i ! no private iti6en ma) la,"ull) resist& T!e promotion o" t!e sugar industr) is a matter o" pu-li on ern, t!us, it "ollo,s t!en t!at t!e Legislature ma) determine ,it!in reasona-le -ounds ,!at is ne essar) "or its prote tion and e*pedient "or its promotion I" t!e Funds "or t!eir prose ution and attainment& Ta*ation ma) -e an implement o" t!e StateAs poli e po,er& TAX VS TARIFFS AND CUSTOMS DUTIES GARCIA VS EIECUTIVE SECRETARD FACTS: 0n 5ovem-er %++/, t!e President issued E&0& :$# ,!i ! imposed on all arti les in t!e P!ilippines an additional dut) o" 'G ad valorem, in luding rude oil and ot!er oil produ ts& Su-se(uentl), t!is dut) ,as in reased to +G ad valorem& 0n Januar) %++%, t!e 20F re(uested t!e Tari"" Commission to initiate t!e pro ess o" t!e imposition o" a spe i"i lev) on rude oil and petroleum produ ts& Upon ompletion o" t!e pu-li !earings and re ommendation o" t!e Commission, t!e President on August %++%, issued E& 0& 5o& :.# ,!i ! levied <in addition to +G ad valorem= a spe ial dut) o" P!p &+' or P!p %'%&/' per -arrel o" imported rude oil and P!p% per liter o" imported oil

TAX VS SPECIAL ASSESSMENT

REPU8LIC VS 8AC0L02H9URCIA FACTS: R&A& 50& ;$@ is t!e !arter o" t!e P!ilippine Sugar Institute, P!ilsugin "or s!ort, a semiHpu-li orporation ,!i ! endeavors to develop t!e sugar industr) in t!e ountr)& To a !ieve its various ends, t!e la, provides t!at t!ere s!all -e a lev) on t!e annual sugar produ tion a ta* o" %/ entavos per pi ul o" sugar "rom sugar ane planters and sugar entrals& In t!e ourse o" its operation, P!ilsugin a (uired Insular Sugar Re"iner) , ,!i ! pre ipitated t!e nonHpa)ment o" t!e ta*es -) appellants !erein& T!e de"endantH appellants ontended t!at t!e pur !ase o" t!e re"iner) ,as not allo,ed under t!e la, and -e ause o" its tremendous losses, t!e ontinued operation o" t!e re"iner) ,as not inimi al to t!eir interests& T!e t!eor) o" t!e petitioner is t!at t!e mone) olle ted "rom t!e A t is a spe ial assessment , as su !, it ma) -e devoted onl) to t!e spe i"i purpose "or ,!i ! t!e assessment ,as aut!ori6ed& T!e) also argued t!at on e it !as -een determined

produ ts& Petitioner !erein !allenge t!e Eos on t!e "ollo,ing grounds: "irst, t!at all revenue measures must originate e* lusivel) "rom t!e 4ouse o" Representatives in a ordan e ,it! Se tion @:, Arti le VI o" t!e ConstitutionB and se ond, t!at t!e President is allo,ed onl), as pres ri-ed -) t!e Code, to impose or modi") tari"" duties ,!en ne essar) to prote t t!e lo al industries and produ ts and not "or t!e purpose o" raising revenues& ISSUE: Are tena-le& petitionerAs ontentions

CALTEI VS C099ISSI05 05 AU2IT FACTS: on Fe-ruar) @, %+#+, t!e C0A sent a letter to Calte* P!ilippines, In & <Calte*=, petitioner, dire ting t!e latter to remit to t!e 0PSF its olle tion o" t!e additional ta* on petroleum produ ts aut!ori6ed under P&2& %+'; amounting to p!p $$' million and in"orming it t!at, pending su ! remittan e, all o" its laims "or reim-ursement "rom t!e 0PSF s!all -e !eld in a-e)an e& 0n 9ar ! +, %+#+, C0A sent anot!er letter in"orming Calte* t!at t!e grand total o" its unremitted olle tions is P!p %&@#. -illion& 8) ,a) o" repl), petitioner su-mitted to t!e C0A t!e proposal "or t!e pa)ment o" t!e olle tion and re over) o" laims -) ,a) o" o""H setting remittan es and reim-ursements& 4o,ever, t!e C0A pro!i-ited t!e proposed s !eme& 4en e, t!is petition& ISSUE: 3!et!er or not Calte* !as a rig!t to o""set its remittan e against its reim-ursements, via 0PSF& 4EL2: 5o, Calte*As o-ligation due to t!e 0PSF ma) not -e o""set against its outstanding laims "rom said "unds& It is ,ellHsettled t!at a ta*pa)er ma) not o""H set ta*es due "rom t!e laims !e ma) !ave against t!e government& Ta*es annot -e su-Ce t o" legal ompensation -e ause t!e government and ta*pa)er are not mutual reditors and de-tors o" ea ! ot!er and a laim "or ta*es is not as su ! a de-t, demand, ontra t or Cudgment as is allo,ed to -e setHo""& Te !ni all) spea1ing in respe t to t!e ta*es "or t!e 0PSF, t!e oil ompanies merel) a t as agents "or t!e Government& Petitioner !as t!e o-ligation to a ount "or and remit t!e ta*es olle ted and t!is dut) stems "orm t!e "idu iar) relations!ip -et,een t!e t,o& T!us, no ompensation is legall) "easi-le& FRA5CIA VS I5TER9E2IATE APPELLATE C0URT

4EL2: PetitionerAs "irst ontention is untena-le& Se tion @# <@=, Arti le VI o" t!e Constitution provides t!at t!e Congress ma), -) la,, aut!ori6e t!e President to "i* tari"" rates, ot!er duties and imposts& Su ! relevant ongressional statute is t!e Tari"" and Customs Code parti ularl) Se tions %/: and :/%, ,!i ! provides t!at >&&t!e rates o" dut) !erein provided or su-se(uentl) "i*ed&&ma) -e revised -) t!e President&? T!us, it is all ,it!in t!e po,er o" t!e President to impose or modi") tari"" rates& T!e se ond ontention is also mispla ed& Custom duties an -e imposed not onl) "or regulator) purposes -ut also, li1e ta*es, "or revenueHraising& T!e lev)ing o" ustom duties on imported goods ma) !ave in some measure t!e e""e t o" prote ting t!e lo al industries& Simultaneousl), !o,ever, t!e ver) same ustom duties ma) !ave in some measure t!e e""e t o" produ ing governmental revenues& Custom duties li1e internal revenue ta*es are rarel), i" ever, designed to a !ieve one poli ) o-Ce tive onl)&

OBLIGATION TO PAY VS OBLIGATION TO PAY DEBT

FACTS: Fran ia is a registered o,ner o" a residential lot <$@# s(uare meter= and a t,oHstore) !oise -uilt t!erein& 0n Fe-ruar) %++., a %@' s(uare meter portion o" Fran iaAs propert) ,as e*propriated -) t!e Repu-li "or t!e sum o" P!p :, %%; as Cust ompensation& 0n 2e em-er t!e same )ear, !is propert) ,as sold in a pu-li au tion -) t!e Pasa) Cit) Treasurer in order to satis") a ta* delin(uen ) o" P!p @, :// "or !is "ailure to pa) !is real estate ta*es& Fran ia ,as not present during t!e au tion sale and -) t!e time !e learns o" t!e sale, !e "iled a omplaint to annul it on t!e ground, among ot!ers, t!at !is o-ligation to pa) P@,:// "or supposed ta* delin(uen ) ,as setHo"" -) t!e amount o" P:, %%; ,!i ! t!e government is inde-ted to t!e "ormer& ISSUE: 3!et!er or not t!e ta* delin(uen ) o" t!e petitioner an -e setHo"" -) t!e governmentAs inde-tedness to !im& 4EL2: 5o, legal ompensation in not proper& It !as -een onsistentl) ruled t!at t!ere an -e no o""Hsetting o" ta*es against t!e laims t!at t!e ta*pa)er ma) !ave against t!e government& A person annot re"use to pa) a ta* on t!e ground t!at t!e government o,es !im an amount e(ual to or greater t!an t!e ta* -eing olle ted& Ta*es are not in t!e nature o" ontra ts -et,een t!e part) -ut gro, out o" dut) to, and are t!e positive a ts o" t!e government to t!e ma1ing and en"or ing o" ,!i !, t!e personal onsent o" t!e individual ta*pa)ers is not re(uired& REPU8LIC VS 9A98ULA0 LU98R C09PA5D FACTS: T!e CFI o" 9anila ordered respondent to pa) t!e sum o" P!p :, #/@&$. ,it! ;G interest t!ereon "rom t!e date o" "iling o" t!e omplaint until "ull) paid& 4o,ever, respondent interposed a de"ense: t!at is to o""set its o-ligation onsisting i" "orests !arges ,it! its laim

"or reim-ursements "or t!e Repu-li & T!e reim-ursement laimed -) respondent arises "rom its pa)ment o" >re"orestation !arges? amounting to P+, %@.&'/ on ,!i !, respondent argued, t!e petitioner !as not made use o" "or t!e re"orestation program o" t!e area overed -) its li ense& ISSUE: Is setHo"" legall) permissi-leK 4EL2: 5o, it is not permissi-le& T!e prin iple o" ompensation "ound in Arti le %@.# o" t!e 5CC annot -e applied to t!e ase at -ar& T!e Repu-li and de"endant ompan) are not mutuall) reditors and de-tors o" ea ! ot!er& T!e "orest !argers paid -) respondent are in t!e o""ers o" t!e government as ta*es& T!us, on t!e grounds o" pu-li poli ), it is ,ellHsettled t!at no setHo"" is admissi-le& T!e reason "or t!is is t!at ta*es are not in t!e nature o" ontra ts -et,een t!e parties -ut gro, out o" dut) to, and are t!e positive a ts o" t!e government, to t!e ma1ing and en"or ing o" ,!i !, t!e personal onsent o" t!e individual ta*pa)ers is not re(uired& I" t!e ta*pa)er an properl) re"used to pa) !is ta* -e ause !e !as a laim against t!e government, it is plain t!at some legitimate and ne essar) e*penditure must -e urtailed& CIR VS PI5E2A FACTS: Anastasio Pineda died, survived -) !is ,i"e, Felisi ima 8agtas, and %' !ildren, t!e eldest o" ,!i ! 9anuel 8& Pineda, a la,)er& T!e estate ,as divided among t!e !eirs and 9anuel PinedaAs s!are amounted to P!p @, '//& Later, t!e 8IR investigated t!e in ome ta* lia-ilit) o" t!e estate "or t!e )ears %+:'H%+:# and it "ound t!at t!e orresponding ta* returns ,ere nit "iled& T!ereupon, t!e olle tor "iled said returns and issued an assessment ,!i ! ,as re eived -) Pineda& T!e latter appealed and opposes t!e proposition t!at !e ,ill -e lia-le "or

t!e pa)ment o" all t!e ta*es due "rom t!e estate& Pineda argued t!at !e is lia-le onl) up to t!e e*tent o" and in proportion to an) s!are !e re eived& ISSUE: 3!et!er or not Pineda an -e re(uired to pa) t!e "ull amount o" t!e ta*es assessed& 4EL2: Des, t!e government an re(uire Pineda& T!e government !as t,o ,a)s o" olle ting t!e ta* in (uestion& 0ne, -) going a"ter all t!e !eirs and olle ting "rom ea ! o" t!em t!e amount o" t!e ta* proportionate to t!e in!eritan e re eived& Anot!er remed), pursuant to t!e lien reated -) Se tion $%' o" t!e Ta* Code, is -) su-Ce ting su ! propert) o" t!e estate ,!i ! is in t!e !ands o" an !eir or trans"eree to t!e pa)ment o" t!e ta* due t!e estate& T!is se ond measure is t!e ver) avenue t!e Government too1 in t!is ase to olle t a ta*& T!e 8IR s!ould -e given t!e ne essar) dis retion to avail itsel" o" t!e most e*peditious ,a) to olle t t!e ta* -e ause ta*es are t!e li"e-lood o" t!e government and t!eir prompt and ertain availa-ilit) is in imperious need& P4ILEI 9I5I5G VS CIR FACTS: 0n August ', %++@, t!e 8IR sent a letter to P!ile* as1ing it to settle its ta* lia-ilities in t!e total amount o" %@$&# million& In its repl), P!ile* protested t!e demand "or pa)ment o" t!e ta* lia-ilities stating t!at it !as pending laims "or VAT input reditLre"und "or t!e ta*es it paid "or t!e )ears %+#+ to %++%, in t!e amount o" P%%+&+. million& T!us, P!ile* is as1ing to set it o"" "or its ta* lia-ilities& 4o,ever, su ! proposition ,as denied -) t!e CIR on t!e ground t!at legal ompensation is not allo,ed& Su ! ruling ,as a""irmed -) t!e CTA and later on -) t!e CA& 4en e, t!is petition&

ISSUE: 3!et!er or not legal ompensation is allo,ed& 4EL2: 5o, legal ompensation is not allo,ed -) la,& Ta*es annot -e su-Ce t to ompensation "or t!e simple reason t!at t!e government and t!e ta*pa)ers are not mutual reditors and de-tors o" ea ! ot!er& 2e-ts are due to t!e government in its orporate apa it), ,!ile ta*es are due to t!e government in its sovereign apa it)& Ta* is ompulsor) rat!er t!an a matter o" -argain& It does not depend upon t! onsent o" t!e ta*pa)er& 209I5G0 VS GARLIT0S FACTS: T!e Supreme Court de lared as "inal and e*e utor) t!e order "or t!e pa)ment -) t!e estate o" t!e estate and in!eritan e ta*es, !arges and penalties, amounting to P:/, /'#&'' issued -) t!e CFI o" Le)te& T!e "is al presented a petition "or t!e e*e ution o" Cudgment to t!e ourt -elo, to en"or e said de ision& 4o,ever, it ,as denied -) t!e Court ,!i ! !eld t!at t!e e*e ution is not Custi"ia-le as t!e Government is inde-ted to t!e estate in t!e amount o" P!p @;@, @//& ISSUE: 3!et!er or not said order is valid& 4EL2: Des, t!e order is valid& It is lear t!at t!e laim o" t!e estate against t!e government !as -een re ogni6ed and su ! amount !as alread) -een appropriated "or t!at purpose -) a orresponding la, <R&A& 5o& @.//=& Under t!e ir umstan es, -ot! t!e laim o" t!e government "or in!eritan e ta*es and t!e laim o" t!e intestate "or servi es rendered !ave alread) -e ame due and demanda-le as ,ell as "ull) li(uidated& Compensation t!ere"ore ta1es pla e -) operation o" la,&

REVENUE-RAISING PAL VS EDU (SAME AS THE FIRST DIGEST) OSMENA VS ORBOS (FOR FURTHER ANALYSIS)

reali6ation t!at earnings o" videogram industr) o" around P;// million per annum !ave not -een su-Ce ted to ta*, t!ere-) depriving t!e government o" a sour e o" revenue& Lastl), t!e lev) o" t!e $/G ta* is "or a pu-li purpose& It ,as imposed primaril) to regulate t!e video industr) and prote t t!e movie industr)& T!us, t!e ta* remains a valid imposition& CALTEI VS C0A

NON-REVENUE/SPECIAL OR REGULATORY REPU8LIC VS 8AC0L02 9URCIA <SA9E AS T4E FIRST 2IGEST= TI0 VS VI2E0GRA9 REGULAT0RD 80AR2 FACTS: Presidential 2e ree 5o& %+#. entitled >An A t Creating t!e Videogram Regulator) 8oard? ,as promulgared on 0 to-er ', %+#'& T!e 8oard reated under t!e la, !as -road po,ers to regulate and supervise t!e videogram industr)& A mont! later, P&2& %++: ,as ena ted amending t!e 5IRC regarding t!e annula ta* on video tapes up to $/G& Petitioner !erein assails t!e onstitutionalit) o" t!e 2e ree on t!e ground, among ot!ers, t!at t!e >ta* imposed is !ars!, on"is ator), oppressive andLor in unla,"ul restraint o" trade in violation o" t!e due pro ess lause o" t!e Constitution?& ISSUE: 3!et!er or ontention is tena-le& not petitionerAs

4EL2: 5o, it is not tena-le& A ta* does not ease to -e valid merel) -e ause it regulates, dis ourages or even de"initel) deters t!e a tivities ta*ed& T!e po,er to impose ta*es in one so unlimited in "or e and so sear !ing in e*tent, t!at t!e ourts s ar el) venture t!at it is su-Ce t to an) restri tions ,!atsoever& T!e ta* imposed -) t!e 2e ree is not onl) a regulator) -ut also a revenue measure prompted -) t!e

FACTS: 0n Fe-ruar) @, %+#+, t!e C0A sent a letter to Calte* P!ilippines, In & <Calte*=, petitioner, dire ting t!e latter to remit to t!e 0PSF its olle tion o" t!e additional ta* on petroleum produ ts aut!ori6ed under P&2& %+'; amounting to p!p $$' million and in"orming it t!at, pending su ! remittan e, all o" its laims "or reim-ursement "rom t!e 0PSF s!all -e !eld in a-e)an e& 0n 9ar ! +, %+#+, C0A sent anot!er letter in"orming Calte* t!at t!e grand total o" its unremitted olle tions is P!p %&@#. -illion& 8) ,a) o" repl), petitioner su-mitted to t!e C0A t!e proposal "or t!e pa)ment o" t!e olle tion and re over) o" laims -) ,a) o" o""H setting remittan es and reim-ursements& 4o,ever, t!e C0A pro!i-ited t!e proposed s !eme stating t!at t!ere an -e no o""H setting o" ta*es against t!e laims t!at a ta*pa)er ma) !ave against t!e government, as ta*es do not arise "rom ontra ts or depend upon t!e ,ill o" t!e ta*pa)er, -ut are imposed -) la,& Re"uting respondentAs ontention, petitioner laim t!at t!e amounts due to t!e 0PSF do not arise as a result o" ta*ation -e ause t!e 0PSF is a spe ial "und and ontri-utions do not go to t!e general "und and not "or pu-li purposes& 8e ause o" la 1 o" pu-li purpose, t!e e*a tions "rom 0PSF is not a ta* and t!us, o""Hset is possi-le& ISSUE: 3!et!er or not Calte*As ontention is tena-le&

4EL2: 5o, it is not tena-le& Ta*ation is no longer envisioned as a measure merel) to raise revenue to support t!e governmentB ta*es ma) -e levied ,it! a regulator) purpose to provide means "or t!e re!a-ilitation and sta-ili6ation o" a t!reatened industr) ,!i ! is a""e ted ,it! pu-li interest as to -e ,it!in t!e poli e po,er o" t!e state& T!ere an -e no dou-t t!at t!e oil industr) is greatl) im-ued ,it! pu-li interest as it vitall) a""e ts t!e general ,el"are& T!e sta-ili6ation t!en o" oil pri es is one o" t!e prime on ern t!e state ma) properl) address& ESS0 STA52AR2 VS CIR FACTS: T!e CIR assessed ESS0 a de"i ien ) in ome ta* "or t!e )ear %+;/ plus %#G interest "or t!e period "rom April %#, %+;% to April %#, %+;:, "or a total o" P:$:,@$@&+@& Su ! de"i ien ) arose "rom t!e disallo,an e o" t!e margin "ees o" P%&@@ million paid -) ESS0 to t!e Central 8an1 on its pro"it remittan e to its 5e, Dor1 !ead o""i e& ESS0 paid under protest t!e de"i ien )& 0n August %$, %+;:, ESS0 laim a re"und on t!e ground, among ot!ers, t!at it overpa)ed its %+'+ and %+;/ in ome ta*es -e ause t!e margin "ees paid to t!e Central 8an1 are onsidered ta*es and allo,ed as dedu ti-le -usiness e*penses& ISSUE: 3!et!er or not t!e margin "ees imposed on t!e petitioner -e onsidered as ta*es& 4EL2: 5o, a margin "ee is not a ta* -ut an e*a tion design to ur- t!e e* essive demands upon our international reserves& As su !, t!e margin "ee ,as imposed -) t!e State in t!e e*er ise o" its poli e po,er and not t!e po,er o" ta*ation& A ordingl), a margin lev) o" "oreign e* !ange is a "orm o" e* !ange ontrol or restri tion designed to dis ourage imports and en ourage e*ports& E* !ange

restri tions serve various purposes su ! as limiting nonHessential imports, prote ting t!e lo al industries, providing a sour e o" revenue and ot!ers& All in all, margin levies or "ees on e* !ange rates are applied -) t!e State to strengt!en t!e Central 8an1As international reserves in t!e e*er ise o" t!e poli e po,er& As su !, it is not onsidered as ta*es& NECESSITY THEORY P4IL& GUARA5TD VS CIR FACTS: Petitioner, a domesti insuran e ompan), entered into reinsuran e ontra ts, on various dates, ,it! "oreign insuran e ompanies not doing -usiness in t!e P!ilippines& Pursuant to a"oresaid reinsuran e ontra ts, petitioner eded to "oreign reinsurers t!e "ollo,ing premiums: P!p #:@,:;;&.% in %+'$ and P!p .@%, :.%&#' in %+':& 3!en t!e petitioner "iled its in ome ta* returns "or %+'$ and %+':, it e* luded said premiums& Also, it did not ,it!!old or pa) ta* on t!em& 3it! t!is, t!e CIR assessed petitioner ,it!!olding ta* on t!e "ollo,ing amount: P@$/,;.$ "or %+'$ and P@$:,$;: "or %+':& Petitioner protested t!e assessment on t!e ground t!at reinsuran e premiums eded to "oreign reinsurers not doing -usiness in t!e P!ilippines are not su-Ce t to ,it!!olding ta*& ISSUE: 3!et!er or ontention is valid& 4EL2: 5o, it is not valid& T!e po,er to ta* is an attri-ute o" sovereignt)& It is a po,er emanating "rom ne essit)& It is a ne essar) -urden to preserve t!e StateAs sovereignt) and a >means to give t!e iti6enr) an arm) to resists aggression, a nav) to de"end its s!ores, a orps o" ivil servantsM&and "a ilities and prote tion ,!i ! a government is supposed to provide&? not petitionerAs

It is lear "rom t!e ase t!at t!e transa tions or a tivities t!at onstituted t!e reinsuran e o" petitioner ,ere per"ormed in t!e P!ilippines& T!e reinsuran e premiums ,ere generated in t!e ountr)& T!ese premiums ame "rom sour es in t!e P!ilippines& T!us, onsidering t!at t!e reinsuran e premiums in (uestion ,ere a""orded prote tion -) t!e government and t!e re ipient "oreign reinsurers e*er ised rig!ts and privileges granted -) our la,s, su ! reinsuran e premiums and reinsurers s!ould s!are t!e -urden o" maintaining t!e State& CIR VS ALGUE (SAME AS THE FIRST DIGEST)