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TITLE: J.B.L. Reyes, Edmundo Reyes, et al, petitioner, v.

Board of Assessment Appeals of Manila and City Assessor of Manila, respondents CITATION: G.R. Nos. L-49839-46, 196 SCRA 322 DATE: April 26, 1991 FACTS: J.B.L Reyes, et al., petitioners, owners of parcels of land in Tondo and Sta. Cruz Districts, City of Manila which are leased by tenants for a monthly rentals not exceeding three hundred pesos (P300.00) in July 1971. Around that time, a law was passed prohibiting the increase of rentals of properties leased for rentals not exceeding P300.00 monthly and ejecting lessees after the expiration of the usual legal period of lease. In 1973, respondent City Assessor of Manila re-classified and reassessed the value of the subject properties based on the schedule of market values which entailed an increase in the acorresponding tax rates prompting petitioners to file a Memorandum of Disagreement with the Board of Tax Assessment Appeals. They averred that the reassessments made were "excessive, unwarranted, inequitable, confiscatory and unconstitutional" considering that the taxes imposed upon them greatly exceeded the annual income derived from their properties. They argued that the income approach should have been used in determining the land values instead of the comparable sales approach which the City Assessor adopted ISSUE: Is the approach adopted by the City Assessor appropriate in assessing the property? HELD: No. The taxing power is an attribute of sovereignty. However, the power to tax is not unconfined as there are restrictions. The due process and equal protection clauses of the Constitution limit this power. The laws should operate equally and uniformly on all persons under similar circumstances or that all persons must be treated in the same manner, the conditions not being different both in the privileges conferred and the liabilities imposed. The market value of properties covered by P.D. No. 20 cannot be equated with the market value of properties not covered. The former has naturally a much lesser market value in view of the rental restrictions. Consequently, the use of the Comparable Sales Approach in the assessment of the properties on the ground of uniformity is unreasonable.

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