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TAXATION LAW CASE DOCTRINES
Nature and Characteristics of Taxation
CIR vs. Algue, Inc
whether or not the Collector of Internal Revenue correctly
disallowed the P75,000.00 (pre-operating expenses/promotional
fees) deduction claimed by private respondent Algue as legitimate
business expenses in its income tax returns.
Without taxes, the government would be paralyzed for lack of the
motive power to activate and operate it. Hence, despite the
natural reluctance to surrender part of one's hard earned income
to the taxing authorities, every person who is able to must
contribute his share in the running of the government. The
government for its part, is expected to respond in the form of
tangible and intangible benefits intended to improve the lives of
the people and enhance their moral and material values. This
symbiotic relationship is the rationale of taxation
Roxas vs. CTA
The power of taxation is sometimes called also the power to
destroy
Sison, Jr. vs. Ancheta
Petitioner as taxpayer alleges that by virtue thereof, "he would be
unduly discriminated against by the imposition of higher rates of
tax upon his income arising from the exercise of his profession vis-
a-vis those which are imposed upon fixed income or salaried
individual taxpayers.
The power to tax, an inherent prerogative. It is the strongest of all
the powers of government. Taxes being the lifeblood of the
government, their prompt and certain availability is of the essence.
'the power to tax is not unconfined. There are restrictions. The
Constitution sets forth such limits. 'The power to tax is not the
power to destroy while this Court sits. "Where the assailed tax
measure is beyond the jurisdiction of the state, or is not for a
public purpose, or, in case of a retroactive statute is so harsh and
unreasonable, it is subject to attack on due process grounds.
Equality and uniformity in taxation means that all taxable articles
or kinds of property of the same class shall be taxed at the same
rate. The taxing power has the inherent power to make reasonable
and natural classifications for purposes of taxation.
Taxpayers may be classified into different categories. Discernible
basis of classification is the susceptibility of the income to the
application of generalized rules removing all deductible items for
all taxpayers within the class and fixing a set of reduced tax rates to
be applied to all of them. Taxpayers who are recipients of
compensation income are set apart as a class. As there is
practically no overhead expense, these taxpayers are not entitled
to make deductions for income tax purposes because they are in
the same situation more or less. On the other hand, in the case of
professionals in the practice of their calling and businessmen,
there is no uniformity in the costs or expenses necessary to
produce their income. It would not be just then to disregard the
disparities by giving all of them zero deduction and
indiscriminately impose on all alike the same tax rates on the basis
of gross income.
Tan Tiong Bio vs. CIR
Dee Hong Lue ’sold’ the pile to the Central Syndicate for exactly the
same price barely forty-six (46) days after acquiring it from FLC and
exactly five (5) days after the Syndicate was registered with the
Securities and Exchange Commission. CIR assessed the petitioners.
Petitioners argue (1) that the Court of Tax Appeals acted in excess
of its jurisdiction in holding them liable as officers or directors of
the defunct Central Syndicate for the tax liability of the latter; (2)
that petitioners cannot be held liable for said tax liability there
being no statutory provision in this jurisdiction authorizing the
government to proceed against the stockholders of a defunct
corporation as transferees of the corporate assets upon
liquidation; (3) that assuming that the stockholders can be held so
liable, they are only liable to the extent of the benefits derived by
them from the corporation.
A creditor of a dissolved corporation may follow its assets, as in the
nature of a trust fund, into the hands of its stockholders
(MacWilliams v. Excelsier Coal Co. [1924] 298 Fed. 384). An
indebtedness of a corporation to the federal government for
income and excess profit taxes is not extinguished by the
dissolution of the corporation.
Purpose of Taxation
Philippine Airlines, Inc. vs. Edu
What is the nature of motor vehicle registration fees? Are they
taxes or regulatory fees? Under its franchise, PAL is exempt from
the payment of taxes.
Fees may be properly regarded as taxes even though they also
serve as an Instrument of regulation. If the purpose is primarily
revenue, or if revenue is at least one of the real and substantial
purposes, then the exaction is properly called a tax. These
exactions are sometimes called regulatory taxes. Indeed, taxation
may be made the implement of the state’s police power.
Motor vehicle registration fees as at present exacted pursuant to
the Land Transportation and Traffic Code are actually taxes
intended for additional revenues of government even if one fifth or
less of the amount collected is set aside for the operating expenses
of the agency administering the program. PAL is now exempt from
the payment of any tax, fee, or other charge on the registration
and licensing of motor vehicles. Such payments are already
included in the basic tax or franchise tax provided in Subsections
(a) and (b) of Section 13, P.D. 1590
Osmena vs. Orbos
The petitioner argues that "the monies collected pursuant to . . P.D.
1956, as amended, must be treated as a 'SPECIAL FUND,' not as a
'trust account' or a 'trust fund,' and that "if a special tax is
collected for a specific purpose, the revenue generated therefrom
shall 'be treated as a special fund' to be used only for the purpose
indicated, and not channeled to another government objective."
Petitioner further points out that since "a 'special fund' consists of
monies collected through the taxing power of a State, such
amounts belong to the State, although the use thereof is limited to
the special purpose/objective for which it was created
The OPSF is a "Trust Account" which was established "for the
purpose of minimizing the frequent price changes brought about
by exchange rate adjustment and/or changes in world market
prices of crude oil and imported petroleum products. While the
funds collected may be referred to as taxes, they are exacted in the
exercise of the police power of the State.
Caltex Phils., Inc., vs. COA
Petitioner’s contention that the OPSF contributions are not for a
public purpose because they go to a special fund of the
government.
Taxation is no longer envisioned as a measure merely to raise
revenue to support the existence of the government; taxes may be
levied with a regulatory purpose to provide means for the
rehabilitation and stabilization of a threatened industry which is
affected with public interest as to be within the police power of
the state.
It is settled that a taxpayer may not offset taxes due from the
claims that he may have against the government. Taxes cannot be
the subject of compensation because the government and
taxpayer are not mutually creditors and debtors of each other and
a claim for taxes is not such a debt, demand, contract or judgment

as is allowed to be set-off. R.A. No. 6952 does not authorize oil
companies to offset their claims against their OPSF contributions.
Instead, it prohibits the government from paying any amount from
the Petroleum Price Standby Fund to oil companies which have
outstanding obligations with the government, without said
obligation being offset first subject to the rules on compensation in
the Civil Code.
Jurisdiction over subject and objects (From SC Syllabus)
Gomez vs. Palomar
To help raise funds for the Philippine Tuberculosis Society, the
Director of Posts shall order that no mail matter shall be accepted
in the mails unless it bears such semi-postal stamps. Claim is made
that it constitutes mail users into a class for the purpose of the tax
while leaving untaxed the rest of the population and that even
among postal patrons the statute discriminatorily grants
exemption to newspapers. What the petitioner asserts is that
statutory classification of mail users must bear some reasonable
relationship to the end sought to be attained, and that absent such
relationship the selection of mail users is constitutionally
impermissible.
Legislature has the inherent power to select the subjects of
taxation and to grant exemptions. While the principle that there
must be a reasonable relationship between classification made by
the legislation and its purpose is undoubtedly true in some
contexts, it has no application to a measure whose sole purpose is
to raise revenue ... So long as the classification imposed is based
upon some standard capable of reasonable comprehension, be
that standard based upon ability to produce revenue or some
other legitimate distinction, equal protection of the law has been
afforded. Considerations of administrative convenience and cost
afford an adequate ground for classification
The five centavo charge levied by Republic Act 1635, as amended,
is in the nature of an excise tax, laid upon the exercise of a
privilege, namely, the privilege of using the mails.
Lorenzo vs. Posadas
Transmission by inheritance is taxable at the time of the
predecessor’s death, notwithstanding the postponement of the
actual possession or enjoyment of the estate by the beneficiary,
and the tax measured by the value of the property transmitted at
that time regardless of its appreciation or depreciation.
Inheritance taxation is governed by the statute in force at the time
of the death of the decedent
Thus, no court is allowed to grant injunction to restrain the
collection of any internal revenue tax.
License Fees or Charges
Angeles University Foundation vs. City of Angeles
Petitioner claimed that it is exempt from the payment of the
building permit and locational clearance fees. Petitioner stresses
that the tax exemption granted to educational stock corporations
which have converted into non-profit foundations was broadened
to include any other charges imposed by the Government as one
of the incentives for such conversion.
Charges refers to pecuniary liability, as rents or fees against
persons or property, while fee means a charge fixed by law or
ordinance for the regulation or inspection of a business or activity.
building permit fee is a regulatory imposition is highlighted by the
fact that in processing an application for a building permit, the
Building Official shall see to it that the applicant satisfies and
conforms with approved standard requirements on zoning and
land use, lines and grades, structural design, sanitary and
sewerage, environmental health, electrical and mechanical safety
as well as with other rules and regulations implementing the
National Building Code. Since building permit fees are not charges
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on property, they are not impositions from which petitioner is
exempt.
In distinguishing tax and regulation as a form of police power, the
determining factor is the purpose of the implemented measure. If
the purpose is primarily to raise revenue, then it will be deemed a
tax even though the measure results in some form of regulation.
On the other hand, if the purpose is primarily to regulate, then it is
deemed a regulation and an exercise of the police power of the
state, even though incidentally, revenue is generated.
City of Iloilo vs. Villanueva
City sought to collect from the spouses an annual license tax fee.
Defendant spouses answered the complaint contending that the
ordinance under which the tax is sought to be collected infringes
the powers granted to the city by its Charter and that said
ordinance is violative of the constitutional provision requiring
uniformity of taxation upon the theory that it is oppressive,
unreasonable and discriminatory.
License fees for revenue rest upon the taxing power as
distinguished from the police power, and the power of the
municipality to exact such fees must be expressly granted by
charter or statute and is not to be implied from the conferred
power to license and regulate merely.
If the fee is designed to raise substantially more than the cost of
the regulation to which it purports to be an incident, its purpose is
to raise revenue. If it is a fee attached to a particular provision for
regulation, and appears to be imposed to cover the cost of that
regulation, and does substantially only that, then it is merely for
the cost-paying part of a regulatory measure.
Municipal corporation, unlike a sovereign state, is clothed with no
inherent power of taxation. "The charter or statute must plainly
show an intent to confer that power or the municipality cannot
assume it. And the power when granted is to be construed
strictissimi juris.
Special Assessment
Republic vs. Bacolod-Murcia Milling Co. Inc
appellants refused to continue with their contributions to the said
fund. They maintained that their obligation to contribute or pay to
the said Fund subsists only to the limit and extent that they are
benefited by such contributions since Republic Act 632 is not a
revenue measure but an Act which establishes a "special
assessment." As such, the proceeds thereof may be devoted only
to the specific purpose for which the assessment was authorized, a
special assessment being a levy upon property predicated on the
doctrine that the property against which it is levied derives some
special benefit from the improvement.
The levy for the Philsugin Fund is not so much an exercise of the
power of taxation, nor the imposition of a special assessment, but,
the exercise of the police power for the general welfare of the
entire country. It is, therefore, an exercise of a sovereign power
which no private citizen may lawfully resist.
Toll Fees
Diaz vs. Secretary of Finance
Assailing the validity of the impending imposition of value-added
tax (VAT) by the Bureau of Internal Revenue (BIR) on the collections
of tollway operators. Petitioners argue that a toll fee is a "user’s
tax" and to impose VAT on toll fees is tantamount to taxing a tax.
fees paid by the public to tollway operators for use of the tollways,
are not taxes in any sense. A tax is imposed under the taxing power
of the government principally for the purpose of raising revenues
to fund public expenditures.27 Toll fees, on the other hand, are
collected by private tollway operators as reimbursement for the
costs and expenses incurred in the construction, maintenance and

operation of the tollways, as well as to assure them a reasonable
margin of income. Although toll fees are charged for the use of
public facilities, therefore, they are not government exactions that
can be properly treated as a tax. Taxes may be imposed only by the
government under its sovereign authority, toll fees may be
demanded by either the government or private individuals or
entities, as an attribute of ownership.
VAT on tollway operations is not really a tax on the tollway user,
but on the tollway operator. The latter merely shifts the burden of
VAT to the tollway user as part of the toll fees. VAT is assessed
against the tollway operator’s gross receipts and not necessarily on
the toll fees.
Customs Duties
Garcia vs. The Executive Secretary
He contends that since the Constitution vests the authority to
enact revenue bills in Congress, the President may not assume
such power of issuing Executive Orders Nos. 475 and 478 which are
in the nature of revenue-generating measures. Executive Order No.
475 was issued by the President on 15 August 1991 reducing the
rate of additional duty on all imported articles from nine percent
(9%) to five percent (5%) ad valorem except in the cases of crude
oil and other oil products which continued to be subject to the
additional duty of nine percent (9%) ad valorem. President issued
Executive Order No. 478, dated 23 August 1991, which levied (in
addition to the aforementioned additional duty of nine percent
(9%) ad valorem and all other existing ad valorem duties) a special
duty of P0.95 per liter or P151.05 per barrel of imported crude oil
and P1.00 per liter of imported oil products.
There is thus explicit constitutional permission 1 to Congress to
authorize the President "subject to such limitations and restrictions
as [Congress] may impose" to fix "within specific limits" "tariff
rates . . . and other duties or imposts. The relevant congressional
statute is the Tariff and Customs Code of the Philippines.
Customs duties which are assessed at the prescribed tariff rates
are very much like taxes which are frequently imposed for both
revenue-raising and for regulatory purposes. 4 Thus, it has been
held that "customs duties" is "the name given to taxes on the
importation and exportation of commodities, the tariff or tax
assessed upon merchandise imported from, or exported to, a
foreign country." 5 The levying of customs duties on imported
goods may have in some measure the effect of protecting local
industries — where such local industries actually exist and are
producing comparable goods. Simultaneously, however, the very
same customs duties inevitably have the effect of producing
governmental revenues. Customs duties like internal revenue taxes
are rarely, if ever, designed to achieve one policy objective only.
Most commonly, customs duties, which constitute taxes in the
sense of exactions the proceeds of which become public funds 6 —
have either or both the generation of revenue and the regulation
of economic or social activity as their moving purposes and
frequently, it is very difficult to say which, in a particular instance,
is the dominant or principal objective.
Debt
Francia vs. IAC
Francia’s property was expropriated by the Republic. Also, Francia
failed to pay his real estate taxes. Francia contends that his tax
delinquency of P2,400.00 has been extinguished by legal
compensation. He claims that the government owed him
P4,116.00 when a portion of his land was expropriated.
There can be no off-setting of taxes against the claims that the
taxpayer may have against the government. A person cannot
refuse to pay a tax on the ground that the government owes him
an amount equal to or greater than the tax being collected. The
collection of a tax cannot await the results of a lawsuit against the
government. Taxes are not in the nature of contracts between the
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parties but grow out of duty to, and are the positive acts of the
government to the making and enforcing of which, the personal
consent of individual taxpayers is not required. Government and
taxpayer ‘are not mutually creditors and debtors of each other’
under Article 1278 of the Civil Code and a "claim for taxes is not
such a debt, demand, contract or judgment as is allowed to be set-
off. The tax was due to the city government while the
expropriation was effected by the national government.
Philex Mining vs. CIR
Philex protested the demand for payment of the tax liabilities
stating that it has pending claims for VAT input credit/refund for
the taxes it paid. Therefore these claims for tax credit/refund
should be applied against the tax liabilities.
Taxes cannot be subject to compensation for the simple reason
that the government and the taxpayer are not creditors and
debtors of each other. 17 There is a material distinction between a
tax and debt. Debts are due to the Government in its corporate
capacity, while taxes are due to the Government in its sovereign
capacity. taxes are the lifeblood of the government and so should
be collected without unnecessary hindrance. It must be noted that
a distinguishing feature of a tax is that it is compulsory rather than
a matter of bargain. 25 Hence, a tax does not depend upon the
consent of the taxpayer.
Domingo vs. Garlitos
In order to enforce the claims against the estate (inheritance tax)
the fiscal presented a petition dated June 21, 1961, to the court
below for the execution of the judgment. The petition was,
however, denied by the court which held that the execution is not
justifiable as the Government is indebted to the estate.
The claim of the estate against the Government has been
recognized and an amount of P262,200 has already been
appropriated for the purpose. Under the above circumstances,
both the claim of the Government for inheritance taxes and the
claim of the intestate for services rendered have already become
overdue and demandable as well as fully liquidated.
Compensation, therefore, takes place by operation of law.
Air Canada vs. CIR
Air Canada filed a written claim for refund of alleged erroneously
paid income. CTA denied and found that Air Canada was engaged
in business in the Philippines through a local agent that sells airline
tickets on its behalf. As such, it should be taxed as a resident
foreign corporation at the regular rate of 32%.
An offline international air carrier selling passage tickets in the
Philippines, through a general sales agent, is a resident foreign
corporation doing business in the Philippines. In order that a
foreign corporation may be regarded as doing business within a
State, there must be continuity of conduct and intention to
establish a continuous business, such as the appointment of a local
agent, and not one of a temporary character.
Court of Tax Appeals properly denied petitioner's claim for refund
it was liable instead for the regular 32% tax on its taxable income
received from sources within the Philippines. Its determination of
petitioner's liability for the 32% regular income tax was made
merely for the purpose of ascertaining petitioner's entitlement to a
tax refund and not for imposing any deficiency tax.
Double Taxation
CIR vs. Solidbank
Whether or not the 20% final withholding tax on [a] bank’s interest
income forms part of the taxable gross receipts in computing the
5% gross receipts tax.
Double taxation means taxing the same property twice when it
should be taxed only once; that is,." . . taxing the same person
twice by the same jurisdiction for the same thing.

First, the taxes herein are imposed on two different subject
matters. The subject matter of the FWT is the passive income
generated in the form of interest on deposits and yield on deposit
substitutes, while the subject matter of the GRT is the privilege of
engaging in the business of banking. Second, although both taxes
are national in scope because they are imposed by the same taxing
authority — the national government under the Tax Code — and
operate within the same Philippine jurisdiction for the same
purpose of raising revenues, the taxing periods they affect are
different. The FWT is deducted and withheld as soon as the income
is earned, and is paid after every calendar quarter in which it is
earned. On the other hand, the GRT is neither deducted nor
withheld, but is paid only after every taxable quarter in which it is
earned. Third, these two taxes are of different kinds or characters.
The FWT is an income tax subject to withholding, while the GRT is
a percentage tax not subject to withholding.
Nursery Care Corporation vs. Acevedo
The City of Manila assessed and collected taxes from the individual
petitioners pursuant to Section 15 (Tax on Wholesalers,
Distributors, or Dealers) and Section 17 (Tax on Retailers) of the
Revenue Code of Manila.3 At the same time, the City of Manila
imposed additional taxes upon the petitioners pursuant to Section
21 of the Revenue Code of Manila of 50%.
There is double taxation when the same taxpayer is taxed twice
when he should be taxed only once for the same purpose by the
same taxing authority within the same jurisdiction during the same
taxing period, and the taxes are of the same kind or character.
Firstly, because Section 21 of the Revenue Code of Manila imposed
the tax on a person who sold goods and services in the course of
trade or business based on a certain percentage of his gross sales
or receipts in the preceding calendar year, while Section 15 and
Section 17 likewise imposed the tax on a person who sold goods
and services in the course of trade or business but only identified
such person with particularity, namely, the wholesaler, distributor
or dealer (Section 15), and the retailer (Section 17), all the taxes –
being imposed on the privilege of doing business in the City of
Manila in order to make the taxpayers contribute to the city’s
revenues – were imposed on the same subject matter and for the
same purpose. Secondly, the taxes were imposed by the same
taxing authority (the City of Manila) and within the same
jurisdiction in the same taxing period (i.e., per calendar year).
Thirdly, the taxes were all in the nature of local business taxes.
CIR vs. S.C. Johnson and Sons, Inc.
Respondent] filed with the International Tax Affairs Division (ITAD)
of the BIR a claim for refund of overpaid withholding tax on
royalties arguing that, royalties paid by the [respondent] to SC
Johnson and Son, USA is only subject to 10% withholding tax
pursuant to the most-favored nation clause of the RP-US Tax Treaty
and not the 25% WHT.
The most favored nation clause is intended to establish the
principle of equality of international treatment by providing that
the citizens or subjects of the contracting nations may enjoy the
privileges accorded by either party to those of the most favored
nation.
Thus, if the rates of tax are lowered by the state of source, in this
case, by the Philippines, there should be a concomitant
commitment on the part of the state of residence to grant some
form of tax relief, whether this be in the form of a tax credit or
exemption. Otherwise, the tax which could have been collected by
the Philippine government will simply be collected by another
state, defeating the object of the tax treaty since the tax burden
imposed upon the investor would remain unrelieved. If the state of
residence does not grant some form of tax relief to the investor, no
benefit would redound to the Philippines. Since the RP-US Tax
Treaty does not give a matching tax credit of 20 percent for the
taxes paid to the Philippines on royalties as allowed under the RP-
West Germany Tax Treaty, private respondent cannot be deemed
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entitled to the 10 percent rate granted under the latter treaty for
the reason that there is no payment of taxes on royalties under
similar circumstances.
Deutsche Bank AG Manila Branch vs. CIR
Petitioner withheld and remitted to respondent fifteen percent
(15%) branch profit remittance tax (BPRT) on its regular banking
unit (RBU) net income remitted to Deutsche Bank Germany (DB
Germany). It sought refund since it alleged that there was
overpayment since it was entitled to 10% preferential rate under
the RP-Germany Tax Treaty.
"tax conventions are drafted with a view towards the elimination
of international juridical double taxation, which is defined as the
imposition of comparable taxes in two or more states on the same
taxpayer in respect of the same subject matter and for identical
periods. By virtue of the RP-Germany Tax Treaty, we are bound to
extend to a branch in the Philippines, remitting to its head office in
Germany, the benefit of a preferential rate equivalent to 10% BPRT.
Taxpayer’s suit
Mamba vs. Lara
Majority of the members of the Sangguniang Panlalawigan of
Cagayan approved Ordinance No. 19-2002, 8 authorizing the bond
flotation of the provincial government in an amount not to exceed
₱500 million to fund the construction and development of the new
Cagayan Town Center. Petitioners filed injunction. W/N they have
locus standing.
for a taxpayer’s suit to prosper, two requisites must be met: (1)
public funds derived from taxation are disbursed by a political
subdivision or instrumentality and in doing so, a law is violated or
some irregularity is committed and (2) the petitioner is directly
affected by the alleged act. As to the second requisite, the court, in
recent cases, has relaxed the stringent "direct injury test" bearing
in mind that locus standi is a procedural technicality. 47 By
invoking "transcendental importance", "paramount public
interest", or "far-reaching implications", ordinary citizens and
taxpayers were allowed to sue even if they failed to show direct
injury.
Construction and applicability of tax laws
CIR vs. Filipinas Compania De Seguros
Before the enactment of Republic Act No. 1612 on August 24,
1956, the uniform fixed annual real estate dealer’s tax was P150.00
for all owners of rental properties receiving an aggregate amount
of P3,000.00 or more a year and that "the yearly fixed taxes are
due on the first of January of each year" Petitioner indisputably
paid in full on January 4, 1956, the total annual tax then prescribed
for the year 1956. Republic Act No. 1612 was passed on August 24,
1956. CIR is collecting the 350 difference.
To require it to pay an additional sum of P350.00 to complete the
P500.00 provided in Republic Act No. 1612 would result in the
imposition upon respondent of a tax burden to which it was not
liable before the enactment of said amendatory act, thus
rendering its operation retroactive rather than prospective, which
cannot be done, as it would contravene the aforecited Section 21
of Republic Act No. 1612 as well as the established rule regarding
the prospectivity of operation of statutes.
When construing a statute, the reason for its enactment should be
kept in mind, and the statute should be construed with reference
to its intended scope and purpose.
CIR vs. CA
In conducting researches and studies of social organizations and
cultural values thru its Institute of Philippine Culture, is the Ateneo
de Manila University performing the work of an independent
contractor and thus taxable?
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statute will not be construed as imposing a tax unless it does so
clearly, expressly, and unambiguously . . . (A) tax cannot be
imposed without clear and express words for that purpose. it is
basic that "in case of doubt, such statutes are to be construed
most strongly against the government and in favor of the subjects
or citizens because burdens are not to be imposed nor presumed
to be imposed beyond what statutes expressly and clearly import.

private respondent is not a contractor selling its services for a fee

but an academic institution conducting these researches pursuant
to its commitments to education and, ultimately, to public service.
For the institute to have tenaciously continued operating for so
long despite its accumulation of significant losses, we can only
agree with both the Court of Tax Appeals and the Court of Appeals
that "education and not profit is [IPC's] motive for undertaking the
research
projects."

Manila International Airport Authority vs. CA

MIAA was being assessed due to unpaid real estate taxes. MIAA
admits that the MIAA Charter has placed the title to the Airport
Lands and Buildings in the name of MIAA. However, MIAA points
out that it cannot claim ownership over these properties since the
real owner of the Airport Lands and Buildings is the Republic of the
Philippines.

MIAA's Airport Lands and Buildings are exempt from real estate tax
imposed by local governments. MIAA is not a government-owned
or controlled corporation but an instrumentality of the National
Government and thus exempt from local taxation. Second, the real
properties of MIAA are owned by the Republic of the Philippines
and thus exempt from real estate tax.

Law vs. Regulation

Secretary of Finance vs. Philippine Tobacco Institute, Inc.

President Benigno S. Aquino III signed Republic Act No. 10351 (RA
10351), otherwise known as the Sin Tax Reform Law. Philippine
Tobacco Institute, Inc. (PTI), paid the excise taxes under protest. PTI
sought to have RR 17-2012 and RMC 90-2012 declared null and
void for allegedly violating the Constitution and imposing tax rates
not authorized by RA 10351. PTI stated that the excise tax rate of
either ₱12 or ₱25 under RA 10351 should be imposed only on
cigarettes packed by machine in packs of 20's or packaging
combinations of 20's and should not be imposed on cigarette
pouches of 5's and 10's.

It is an elementary rule in administrative law that administrative

rules and regulations enacted by administrative bodies to
implement the law which they are entrusted to enforce have the
force of law and are entitled to great weight and respect. However,
these implementations of the law must not override, supplant,or
modify the law but must remain consistent with the law they
intend to implement. It is only Congress which has the power to
repeal or amend the law.

In this case, Section 11 of RR17-2012 and Annex"D-1" on Cigarettes

Packed by Machine of RMC90-2012 clearly contravened the
provisions of RA10351.