Business Law

ARTICLE II
DECLARATION OF PRINCIPLES AND STATE POLICIES
Article 2, Section 20 - The State recognizes the indispensable (important) role of the
private sector, encourages private enterprise, and provides incentives to needed
investments.
the constitution does not favor an economy
state mandated to encourage private enterprise
govt controls breed corruption and discourage business
play favorites
in principe of subsidiarity, govt should not engage in particular business
govts main role is to create and maintain healthy business competition and not moneymaking
ARTICLE VI
THE LEGISLATIVE DEPARTMENT
Article 6, Section 28 - (1) The rule of taxation shall be uniform and equitable. The
Congress shall evolve a progressive system of taxation.
(2) The Congress may, by law, authorize the President to fix within specified limits, and
subject to such limitations and restrictions as it may impose, tariff rates, import and
export quotas, tonnage and wharfage dues, and other duties or imposts within the
framework of the national development program of the Government.
(3) Charitable institutions, churches and parsonages or convents appurtenant thereto,
mosques, non-profit cemeteries, and all lands, buildings, and improvements, actually,

directly, and exclusively used for religious, charitable, or educational purposes shall be
exempt from taxation.
(4) No law granting any tax exemption shall be passed without the concurrence of a
majority of all the Members of the Congress.
Uniformity in taxation - all taxable articles or properties of the same class shall be taxed
at the same rate
Uniformity implies equality in burden not equality in amount
Reason for the rule of uniformity in taxation is that not all persons, properties or
transactions are identical or similar situated. Subjects of taxation must be based on
reasonable and substantial grounds.
Equity in taxation - should be fair and should be based on different people's ability to
pay, which is usually related to their income
Progressive system of taxation - taxpayers pay more in taxes if they earn more in
income.
Sec 28[2] the authority given to the president must be exercised within the framework of
national devt program
Sec 28[3] Test of exemption - covers only property taxes not other taxes
Example: a property leased by the owner to another who uses it, Actually, directly, and
exclusively for religious, charitable or educational purpose is exempt from property
tax but the owner is subject to income tax, even if the income is used or devoted by
him
Note that with respect to cemeteries, only those which are non-profit are exempt from
taxation