TAXATION

32. Villegas vs. Hiu Chiong

- due process
- equal protection
- license fee vs. tax
- where a permit collected from alien job applicants is in excess of the cost of regulation,
the exaction is a tax.
33. Manila Racehorse vs Dela Fuente
- equal protection
- HELD: The tax is assessed not on the owners of the horses but on the owners of the
stables, although there is nothing to stop the stable owners from shifting the tax to the
horse owners in the form of increased rents or fees. The ordinance in question is not
discriminatory and savors of class legislation. There is equality and uniformity in taxation
if all articles or kinds of property of the same class are taxed at the same rate. In the
present case, there would be discrimination if some boarding stables of the same class
used for the same number of horses were not taxed or were made to pay less or more
than others. The number of horses used in the assessment purely is a method of fixing an
equitable and practical distribution of the burden by the measure.
34. CREBA vs. Commissioner (Tolentino vs. Executive Secretary)
- due process of law
- equality and uniformity in taxation
- power of the senate to propose amendments to revenue bills
35. American Bible Society vs. City of Manila
- non-infringement of religious freedom
- HELD: The supreme Court ruled that a municipal license tax on the sale of bibles and
religious articles by a non-stock, non-profit constitutes a curtailment of religious free and
worship which is guaranteed by the Constitution.
36. Philippine Bible Society vs Executive Secretary (Tolentino vs. Executive Secretary)
- claims of press freedom and religious liberty
- HELD: The value-added tax (VAT) is levied on the sale, barter or exchange of goods and
properties as well on the sale or exchange of services. It is equivalent to 10% of the gross
selling price or gross value in money of goods and properties sold, bartered or exchanged
or the gross receipts from the sale or exchange of services. R.A 7716 seeks to widen the
tax base of the existing VAT system and enhance its administration by amending the
NIRC.
In a 10-5 vote, the Supreme Court upheld the validity of R.A. 7716 on the following
grounds:
(1) The procedural requirements of the Constitution have been complied with by Congress
in the enactment of the statute.
(2) Judicial inquiry on whether the formal requirements for the enactment of statutes,
beyond those prescribed by the Constitution, nave been observed is precluded by the
principle of separation of powers.
(3) The law does not abridge freedom of speech, expressions or of the press, nor interfere
with the free exercise of religion, nor deny to any of the parties the right to an
education.
(4) In view of the absence of factual foundation of record, claims that law is regressive,
oppressive and confiscatory and that it violates vested rights protected under the
Contract Clause are prematurely raised and do not justify the grant of prospective
relief by writ of prohibition.
37. Abra Valley College vs. Aquino
- tax exemption of properties actually, directly and exclusively used for religious,
charitable and educational purposes.
- HELD: The Supreme Court ruled that the lease by the school of the lower portion of its
school building to a commercial establishment known as the Northern Marketing
Corporation, which is not even incidental to the educational functions of such school, is
outside the scope of the constitutional grant of tax exemption and is, therefore, subject to

a real estate tax on a pro rata (one-half) basis. Incidentally, the second storey of the
school building which was used for educational purposes (as residential quarters of the
School Directors family) is tax-exempt..