TAXPAYERS SUIT - a case where the act complained of directly involves the illegal dis !rsement of p! lic f!

nds derived from ta"ation # co!rts discretion to allow $ # Ta"payers have s!fficient interest of preventing the illegal e"pendit!res of money raised y ta"ation %&'T ('&ATI'&S A&( )'&TRI*UTI'&S+ $ # A ta"payer is not relieved from the o ligation of paying a ta" eca!se of his elief that it is eing misappropriated y certain officials $ # A ta"payer has no legal standing to ,!estion e"ec!tive acts that do not involve the !se of p! lic f!nds-

0+ Sovereign e,!ality of States 1+ Usage among States 2+ Imm!nity from s!it of a State &'&-(E5E6ATI'& '/ T<E P'=ER T' TAX 6E&ERA5 RU5E> - The power of ta"ation is pec!liarly and e"cl!sively legislative9 therefore9 it may not e delegated EX)EPTI'&S>

0+ (elegation to the President 1+ (elegation to local government !nits 2+ (elegation to administrative !nits P'=ERS =<I)< )A&&'T *E (E5E6ATE(

RE.UISITES /'R A TAXPAYERS PETITI'& 0+ That money is eing e"tracted and spent in violation of specific constit!tional protections against a !ses of legislative power 1+ That p! lic money is eing deflected to any improper p!rpose 2+ That the petitioner see3s to restrain respondents from wasting p! lic f!nds thro!gh the enforcement of an invalid or !nconstit!tional law4I5'S *AYA& vs- 6UI&6'&A $ # The S!preme )o!rt has discretion whether or not to entertain ta"payers s!it and co!ld r!sh aside lac3 of loc!s standi )'&)EPTS RE5ATI7E T' PU*5I) PURP'SE 0+ Ine,!alities res!lting from the singling o!t of one partic!lar class for ta"ation or e"emption infringe no constit!tional limitation It is inherent in the power to ta" that the legislat!re is free to select the s! 8ect of ta"ation n individ!al ta"payer need not derive direct enefits from the ta" The paramo!nt consideration is the welfare of the greater portion of the pop!lation 2+ P! lic p!rpose is contin!ally e"panding- Areas formerly left to private initiative now loose their o!ndaries and may e !nderta3en y the government9 if it is to meet the increasing social challenges of the times :+ P! lic p!rpose is determined at the time of enactment of the ta" law and not at the time of implementation &TER&ATI'&A5 )';ITY - *ased on tradition9 practice or c!stom (')TRI&E '/ I&)'RP'RATI'& $ # The Philippines adopts the generally accepted principles of international law as part of the law of the land $ # If a ta" law violates certain principles of international law9 then it is not only invalid !t also !nconstit!tional 6R'U&(S /'R TAX EXE;PTI'& '/ /'REI6& 6'7ER&;E&T PR'PERTY

0+ (etermination of the s! 8ects to e ta"ed 1+ P!rpose of the ta" 2+ Amo!nt or rate of the ta" :+ ;anner9 means and agencies of collection ?+ Prescription of the necessary r!les with respect thereto (E5E6ATI'& T' T<E PRESI(E&T $ # )ongress may a!thori@e9 y law9 the President to fi"9 within specified limits and s! 8ect to s!ch limitations and restrictions as it may impose 0+ Tariff rates 1+ Import and e"port ,!otas 2+ Tonnage and wharfage d!es :+ 'ther d!ties and import within the national development program of the government $ # There m!st e a law a!thori@ing the President to fi" tariff rates $ # The delegation of power m!st impose limitations and restrictions and specify the minim!m as well as the ma"im!m tariff rates TERRIT'RIA5 AURIS(I)TI'& RU5ES> $ # Ta" laws cannot operate eyond a StateBs territorial limits $ # The government cannot ta" a partic!lar o 8ect of ta"ation which is not within its territorial 8!risdiction$ # Property o!tside ones 8!risdiction does not receive any protection of the State $

# If a law is passed y )ongress9 )ongress m!st always see to it that the o 8ect or s! 8ect of ta"ation is within the territorial 8!risdiction of the ta"ing a!thority SITUS '/ TAXATI'& Place of ta"ation RU5E> - The State where the s! 8ect to e ta"ed has a sit!s may rightf!lly levy and collect the ta" $ # In determining the sit!s of ta"ation9 yo! have to consider the nat!re of the ta"es E"ample> 0+ P'55 TAX9 )APITATI'& TAX9 )';;U&ITY TAX # Residence of the ta"payer 1+ REA5 PR'PERTY TAX 'R PR'PERTY TAX # 5ocation of the property $ # =e can only impose property ta" on the properties of a person whose residence is in the PhilippinesEX)EPTI'&S T' T<E TERRIT'RIA5ITY RU5E A+=here the ta" laws operate o!tside territorial 8!risdiction 0+ TAXATI'& of resident citi@ens on their incomes derived from a road *+=here ta" laws do not operate within the territorial 8!risdiction of the State 0+ =hen e"empted y treaty o ligations 1+ =hen e"empted y international comit SITUS '/ TAX '& REA5 PR'PERTY - 5EX REI SITUS or where the property is located REAS'&> The place where the real property is located gives protection to the real property9 hence the property or its owner sho!ld s!pport the government of that place SITUS '/ PR'PERTY TAX '& PERS'&A5 PR'PERTY - ;'*I5IA SE.U&TUR PERS'&A; C mova les follow the owner C mova les follow the domicile of the owner RU5ES> 0+ TA&6I*5E PERS'&A5 PR'PERTY - =here located9 !s!ally the owners domicile 1+ I&TA&6I*55E PERS'&A5 PR'PERTY 6- R- D (omicile of the owner EX)EPTI'&> The sit!s location not domicile # =here the intangi le personal property has ac,!ired a !siness sit!s in another 8!risdiction E # The principle of F;o ilia Se,!nt!r PersonamG is only for p!rposes of convenience- It m!st yield to the act!al sit!s of s!ch propertyE # Personal intangi le properties which ac,!ires !siness sit!s here in the Philippines 0+ /ranchise which is e"ercised within the Philippines 1+ Shares9 o ligations9 onds iss!ed y a domestic corporation 2+ Shares9 o ligations9 onds iss!ed y a foreign corporation9 H?I of its !siness is cond!cted in the Philippines

:+ Shares9 o ligations9 onds iss!ed y a foreign corporation which shares of stoc3 or onds ac,!ire sit!s here ?+ Rights9 interest in a partnership9 !siness or ind!stry esta lished in the Philippines # These intangi le properties ac,!ire !siness sit!s here in the Philippines9 yo! cannot apply the principle of F;o ilia Se,!nt!r PersonamG eca!se the properties have ac,!ired sit!s here- The location where the income earner resides in the sit!s of ta"ation *+ &ATI'&A5ITY T<E'RY - The co!ntry where the income earner is a citi@en is the sit!s of ta"ation )+ S'UR)E RU5E - The co!ntry which is the so!rce of the income or where the activity that prod!ced the income too3 place is the sit!s of ta"ation SITUS '/ TAX '& I&TEREST I&)';E $ # The residence of the orrower who pays the interest irrespective of the place where the o ligation was contracted )IR vs- *'A) $ # Reven!e derived y an of-line international carrier witho!t any flight from the Philippines9 from tic3et sales thro!gh its local agent are s! 8ect to ta" on gross Philippine illings SITUS '/ EX)ISE TAX # =here the transaction performed <'PE=E55 vs- )';- '/ )UST';S $ # The power to levy an e"cise !pon the performance of an act or the engaging in an occ!pation does not depend !pon the domicile of the person s! 8ect to the e"ercise9 nor !pon the physical location of the property or in connection with the act or occ!pation ta"ed9 !t depends !pon the place on which the act is performed or occ!pation engaged inTh!s9 the ga!ge of ta"a ility does not depend on the location of the office9 !t attaches !pon the place where the respective transaction is perfected and cons!mmated )'&STITUTI'&A5 5I;ITATI'&S I(UE PR')ESS $ # (!e process mandates that no person shall e deprived of life9 li erty9 or property witho!t d!e process of lawPEPSI )'5A vs- ;U&- '/ TA&AUA& - RE.UIRE;E&TS '/ (UE PR')ESS I& TAXATI'

0+ Ta" m!st e for a P! lic p!rpose 1+ Imposed within the Territorial 8!risdiction 2+ &o ar itrariness or oppression in A+ assessment9 and *+ collection (UE PR')ESS I& TAXATI'& ('ES &'T RE.UIRE 0+(etermination thro!gh 8!dicial in,!iry of A+ property s! 8ect to ta" *+ amo!nt of ta" to e imposed 1+ &otice of hearing as to> A+ amo!nt of the ta" *+ manner of apportionment RE.UISITES '/ (UE PR')ESS '/ 5A= 0+ There m!st e a valid law 1+ Ta" meas!re sho!ld not e !nconsciona le and !n8!st as to amo!nt to confiscation of property 2+ Ta" stat!te m!st not e ar itrary as to find no s!pport in the constit!tion $ # =hen is deprivation of life9 li erty or property done in accordance with d!e process of lawJ 0+ If done !nder a!thority of a law that is valid or of the constit!tion itself 1+ After compliance with fair and reasona le methods of proced!re prescri ed y law$ # If properties are ta"ed on the asis of an invalid law9 s!ch deprivation is a violation of d!e process RE;E(Y D as3 for ref!nd $ # To 8!stify the n!llification of a ta" law9 there m!st e a clear and !ne,!ivocal reach of the constit!tion # There m!st e proof of ar itrariness &STA&)ES =<E& T<E TAX 5A= ;AY*E (E)5ARE( AS U&)'&STITUTI'&A5 K)9 '9 &9 UL 0+If it amo!nts to confiscation of property witho!t d!e process 1+If the s! 8ect of ta"ation is o!tside of the 8!risdiction of the ta"ing state 2+The law may e declared as !nconstit!tional if it is imposed not for a p! lic p!rpose :+If a ta" law which is applied retroactively9 imposes !n8!st and oppressive ta"es$ # A ta" law which denies a ta"payer a fair opport!nity to assert his s! stantial rights efore a competent tri !nal is invalid $ # A ta"payer m!st not e deprived of his property for non-payment of ta"es witho!t 0+ notice of lia ility 1+ sale of property at p! lic a!ction # The validity of stat!te may e contested only y one who will s!stain a direct in8!ry in conse,!ence of its enforcement $

# A violation of the inherent limitations on ta"ation wo!ld contravene the constit!tional in8!nctions against deprivation of property witho!t d!e process of law $ # There m!st e proof of ar itrariness9 otherwise apply the pres!mption of constit!tionality $ # (!e process re,!ires hearing efore adoption of legislative r!les y administrative odies of interpretative r!lings- %;isamis vs- (/A+ $ # )ompliance with strict proced!ral re,!irements m!st e followed effectively to avoid a collision co!rse etween the states power to ta" and the individ!al recogni@ed rights %)IR vs- Alg!e+ $ # The d!e process cla!se may correctly e invo3ed only when there is a clear contravention of inherent or constit!tional limitations in the e"ercise of ta" power- %Tan vs- del Rosario+ $ # SU*STAT&TI7E (UE PR')ESS re,!ires that a ta" stat!te m!st e within the constit!tional a!thority of )ongress to pass and that it e reasona le9 fair and 8!st $ # PR')E(URA5 (UE PR')ESS re,!ires notice and hearing or at least an opport!nity to e heard E.UA5 PR'TE)TI'& )5AUSE # All persons9 all properties9 all !sinesses sho!ld e ta"ed at the same rate # prohi its class legislation # prohi its !nd!e discrimination E.UA5ITY I& TAXATI'& %U&I/'R;ITY+ # E,!ality in ta"ation re,!ires that all s! 8ects or o 8ects of ta"ation similarly sit!ated sho!ld e treated ali3e or p!t on e,!al footing oth on the privilege conferred and lia ilities imposed # All ta"a le articles of the same class shall e ta"ed at the same rat # The (octrine does not re,!ire that persons or properties different in fact e treated in law as tho!gh there were the same- =hat it prohi its is class legislation which discriminates against some and favors others $ # As long as there are rational or reasona le gro!nds for doing so9 )ongress may gro!p persons or properties to e ta"ed and it is s!fficient if all mem ers of the same class are s! 8ect to the same rate and the ta" is administered impartially !pon themRE.UISITES '/ A 7A5I( )5ASSI/I)ATI'& %S A 6 E +

0+ It m!st e ased on s! stantial distinction 1+ It m!st apply not only to the present condition9 !t also to f!t!re conditions 2+ It m!st e germane to the p!rpose of the law :+ It m!st apply e,!ally to all mem ers of the same class SU*STA&TIA5 (ISTI&)TI'& # It m!st e real9 material and not s!perficial distinction $ # =hat is not allowed is ine,!ality res!lting from singling o!t of a partic!lar class which violates the re,!isites of a valid classification $ # There may e ine,!ality !t as long as it does not violate the re,!isites of a valid classification that s!ch mere ine,!ality is not eno!gh to 8!stify the n!llification of a ta" law or ta" ordinance $ # Ta"ation is e,!ita le when its !rden falls on those etter a le to pay $ #Altho!gh the e,!al protection cla!se does not for id classification9 it is imperative that the s! stantial differences having a reasona le relation to the s! 8ect of the partic!lar legislation $ # Ta"es are !niform and e,!al when imposed !pon all property of the same class or character within the ta"ing a!thority $ # Ta" e"emptions are not violative of the e,!al protection cla!se9 as long as there is valid classification TIU vs- )A The )onstit!tional right to e,!al protection of the law is not violated y an e"ec!tive order9 iss!ed p!rs!ant to law9 granting ta" and d!ty incentives only to !siness within the Fsec!red areaG of the S! ic Special Economic MoneG and denying them to those who live within the @one !t o!tside s!ch Ffenced inG territory- The )onstit!tion does not re,!ire the a sol!te e,!ality among residents- It is eno!gh that all persons !nder li3e circ!mstances or conditions are given the same privileges and re,!ired to follow the same o ligations- In short9 a classification ased on valid and reasona le standards does not violate the e,!al protection cla!se=e find real and s! stantial distinctions etween the circ!mstances o taining inside and those o!tside the S! ic &aval *ase9 there y 8!stifying a valid and reasona le classificationT=' =AYS E.UA5 PR'TE)TI'& )5AUSE )A& *E 7I'5ATE( 0+ =hen classification is made where there sho!ld e none

e"- =hen the classification does not rest !pon s! stantial distinctions that ma3e for real difference 1+ =hen no classification is made where a classification is called for e"- =hen s! stantial distinctions e"ist !t no corresponding classification is made on the asis thereof 'R;') SU6AR )E&TRA5 vs- )IR $ # If the ordinance is intended to s!pply to a specific ta"payer and to no one else regardless of whether or not other entities elonging to the same class are esta lished in the f!t!re9 it is a violation of the e,!al protection cla!se9 !t if it is intended to apply also to similar esta lishments which may e esta lished in the f!t!re9 then the ta" ordinance is valid even if in the meantime9 it applies to only one entity or ta"payer for the simple reason that there is so far only one mem er of the class s! 8ect of the ta" meas!re U&I/'R;ITY I& TAXATI'& The concept of !niformity in ta"ation implies that all ta"a le articles or properties of the same class shall e ta"ed at the same rateIt re,!ires the !niform application and operation9 witho!t discrimination9 of the ta" in every place where the s! 8ect of the ta" is fo!nd- It does not9 however9 re,!ire a sol!te identity or e,!ality !nder all circ!mstances9 !t s! 8ect to reasona le classificationE.UITY I& TAXATI'& $ # The concept of e,!ity in ta"ation re,!ires that the apportionment of the ta" !rden e more or less9 8!st in the light of the ta"payerBs a ility to sho!lder to ta" !rden and if warranted9 on the asis of the enefits received from the government- Its cornerstone is the ta"payers a ility to pay)RITERIA '/ E.UA5 PR'TE)TI'&

0+ =hen the laws operate !niformly A+ on all persons *+ !nder similar circ!mstances

1+ All persons are treated in the same manner A+ The conditions not eing different *+ *oth in privileges conferred and lia ilities imposed )+ /avoritism and preference not allowed

REE('; '/ T<E PRESS $ # The press is not e"empt from ta"ation $ # The sale of maga@ines or newspapers9 may e the s! 8ect of ta"ation $ # =hat is not allowed is to impose ta" on the e"ercise of an activity which has a connection with freedom of the press %license fee+ # If we impose ta" on persons efore they can deliver or roadcast a partic!lar news or information9 that is the one which cannot e ta"edT'5E&TI&' vs- SE)- '/ /I&A&)E $ # =hat is prohi ited y the constit!tional g!arantee of free press are laws which single o!t the press or target a gro!p elonging to the press for special treatment or which in any way discriminates against the press on the asis of the content of the p! lication /REE('; '/ RE5I6I'& $ # It is the activity which cannot e ta"ed $ # activities which have connection with the e"ercise of religion A;ERI)A& *I*5E S')IETY vs- ;A&I5A $ # The payment of license fees for the distri !tion and sale of i les s!ppresses the constit!tional right of free e"ercise of religionAI;;Y S=A66ART vs- *'AR( '/ E.UA5IMATI'& $ # The /ree E"ercise of Religion )la!se does not prohi it imposing a generally applica le sales and !se ta" on the sale of religio!s materials y a religio!s organi@ation$ # The Sale of religio!s articles can e the s! 8ect of the 7AT $ # =hat cannot e ta"ed is the e"ercise of religio!s worship or activity $ # The income of the priest derived from the e"ercise of religio!s activity can e ta"ed &'&-I;PAIR;E&T )5AUSE $ # The parties to the contract cannot e"ercise the power of ta"ation$ # They cannot agree or stip!late that this partic!lar transaction may e e"empt from ta"- not allowed %e"cept if government+ 'P'SA vs- /A)T'RA& $ # Police power prevails over the non-impairment cla!se 5A I&SU5AR vs- ;A&)<U)A $ # A lawf!l ta" on a new s! 8ect or an increased ta" on an old one9 does not interfere with a contract or impairs its o ligation-

$ # The constit!tional g!arantee of the non-impairment cla!se can only invo3ed in the grant of ta" e"emption RU5ES> 0+ If the e"emption was granted for val!a le consideration and it is granted on the asis of a contract# cannot e revo3ed 1+ If the e"emption is granted y virt!e of a contract9 wherein the government enters into a contract with a private corporation # cannot e revo3ed !nilaterally y the government 2+ If the asis of the ta" e"emption is a franchise granted y )ongress and !nder the franchise or the ta" e"emption is given to a partic!lar holder or person # can e !nilaterally revo3ed y the government %)ongress+ $ # The non-impairment cla!se applies only to contracts and not to a franchise$ # The non-impairment cla!se applies to ta"ation !t not to police power and eminent domain- /!rthermore9 it applies only where one party is the government and the other9 a private individ!al$ # As a r!le9 the o ligation to pay ta" is ased on law*!t when9 for instance9 a ta"payer enters into a compromise with the *IR9 the o ligation of the ta"payer ecomes one ased on contract RU5ES '& TAX A;&ESTY $ # Ta" amnesty9 li3e ta" e"emption9 is never favored nor pres!med in law and if granted y stat!te m!st e constr!ed strictly against the ta"payer9 who m!st show compliance with the law$ #The government is not estopped from ,!estioning the ta" lia ility even if amnesty ta" payments were already received REAS'&> Erroneo!s application and enforcement of the law y p! lic officers do not loc3 s! se,!ent correct application of the stat!te- The government is never estopped y mista3es or errors y its agents E&R'55E( *I55 (')TRI&E 6-R- D An enrolled copy of a ill is concl!sive not only of its provisions !t also of its d!e enactment EX)EPTI'&> In AST'R6A vs- 7I55E6AS9 the S!preme )o!rt Fwent ehindG the enrolled ill and cons!lted the 8o!rnal to determine whether certain provisions of a state had een approved y the Senate PresidentBs admission of a mista3e and withdrawal of his signat!reAR('&I&6 P'=ER '/ T<E PRESI(E&T # The President has the power to grant reprieves9 comm!tations and pardons and remit fines and forfeit!res after conviction y final 8!dgment- %Sec- 0N9 ART 7II+ &ATURE '/ TAX A;&ESTY

D A general pardon or intentional overloo3ing y the state of its a!thority to impose penalties on persons otherwise g!ilty of evasion or violation of a reven!e or ta" law - a sol!te forgiveness or waiver to collect 7III- &' I;PRIS'&;E&T /'R &'&-PAY;E&T '/ P'55 TAX - &o person shall e imprisoned for de t or nonpayment of poll ta" %Sec- 1O ART III+ $ # The non-imprisonment r!le applies to non-payment of poll ta" which is p!nisha le only y a s!rcharge9 !t not to other violations li3e falsification of comm!nity ta" certificate or non-payment of other ta"es

PRESI(E&TIA5 7ET' $ # FThe President shall have the power to veto any partic!lar item or items in an appropriation9 reven!e or tariff ill9 !t the veto shall not affect the item or items to which he does not o 8ectG %Sec- 1P %1+9 ART 7I+ XIII- TARI// P'=ER '/ T<E PRESI(E&T $ FThe )ongress may9 y law9 a!thori@ing the President to fi" within specific limits9 and s! 8ect to s!ch limitations and restrictions as it may impose9 tariff rates9 import and e"port ,!otas9 tonnage and wharfage d!es9 the other d!ties or imports within the framewor3 of the national development program of the 6overnmentG %Sec- 1H %1+9 ART 7I+ RE.UISITES> 0+ There m!st e a law passed y )ongress a!thori@ing the President to impose tariff rates and other fees1+ Under the law9 there m!st e limitations and restrictions on the e"ercise of s!ch power 2+ The ta"es that may e imposed y the President are limited to> A+ Tariff rates

P'55 TAX D ta" of fi"ed amo!nt imposed !pon residents within a specific territory regardless of citi@enship9 !siness or profession E"- )omm!nity ta" IX- TAXATI'& S<A55 *E U&I/'R; A&( E.UITA*5E - The r!le of ta"ation shall e !niform and e,!ita leThe )ongress shall evolve a progressive system of ta"ation- %Sec- 1H %0+ ART 7I+ U&I/'R;ITY - means that all ta"a le articles 3inds of property of the same class shall e ta"ed at the same rate $ # A ta" is !niform when it operates with the same force and effect in every place where the s! 8ect of it is fo!nd E.UITA*I5ITY # Ta"ation is said to e e,!ita le when its !rden falls on those etter a le to pay X- )'&6RESS S<A55 E7'57E A PR'6RESSI7E SYSTE; '/ TAXATI'& PR'6RESSI7ITY $ # Ta"ation is progressive when its rate goes !p depending on the so!rces of the person affected SYTE;S '/ TAXATI'& 0+ PR'P'RTI'&A5 TAXATI'& - where the ta" increases or decreases in relation to the ta" rac3et 1+ PR'6RESSI7E or 6RA(UATE( SYSTE; - where the ta" increases as the income of the ta"payer goes higher 2+ RE6RESSI7E SYSTE; where the ta" decreases as the income of the ta"payer increases PR'6RESSI7ITY IS &'T REPU6&A&T T' U&I/'R;ITY and E.UA5ITY A+ Uniformity does not re,!ire the things which are not different e treated in the same manner *+ (ifferentiation9 which is not ar itrary and conforms to the dictates of 8!stice and e,!ity is allowed- Progressivity is one way of classification)+ The State has the inherent right to select s! 8ects of ta"ation

*+ Import and e"port ,!otas )+ Tonnage and wharfage d!es (+ 'ther d!ties %c!stoms d!ties+ :+ The imposition of these tariff and d!ties m!st e within the framewor3 of the &ational (evelopment program of the government $ # )ongress Fmay not passG a law a!thori@ing the President to impose income ta"9 donors ta"9 and other ta"es which are not in the nat!re of c!stoms d!ties # The )onstit!tion allows only the imposition y the President of these c!stom d!ties XI7- TAX EXE;PTI'& '/ REA5 PR'PERTY $ F)harita le instit!tions9 ch!rches and personages or convents app!rtenant thereto9 morg!es9 non-profit cemeteries and all lands9 !ildings and improvements9 act!ally directly and e"cl!sively !sed for religio!s9 charita le9 or ed!cational p!rposes shall e e"empt from ta"ation-G %Sec- 1H %2+ ART 7I+ APP5I)ATI'&> # The e"emption only covers property ta"es and not other ta"es TEST '/ EXE;PTI'&> # It is the USE of the property and not ownership of the property A*RA 7A55EY )'55E6E vs- A.UI&' %0Q1 S)RA 0OQ+ $ # The e"emption does not only e"tend to indispensa le facilities !t also covers incidental facilities which are

reasona ly necessary to the accomplishment of said p!rpose $ # A property leased y the owner to another who !ses it e"cl!sively for religio!s p!rposes is e"empt from property ta"9 !t the owner is s! 8ect to income ta" or rents received$ # Real property p!rchased y any religio!s sect to e !sed e"cl!sively for religio!s p!rposes are s! 8ect to the ta" on the transfer of ownership or of title to real property %also if donated- donorBs ta"+ $ # Property held for f!t!re !se is not ta" e"emp 5A= 6RA&TI&6 TAX EXE;PTI'&S $ F &o law granting any ta" e"emptions shall e passed witho!t the conc!rrence of a ma8ority of all mem ers of the )ongressG %Sec- 1H %:+ ART 7I+ RU5ES '& 7'TE RE.UIRE;E&T

$ # )ongress is witho!t power to appropriate f!nds for a private p!rpose AX 5E7IE( /'R SPE)IA5 PURP'SES F All money collected or any ta" levied for a special p!rpose shall e treated as a special f!nd and paid o!t for s!ch p!rpose only- If the p!rpose for which a special f!nd was created has een f!lfilled or a andoned9 the alance9 if any9 shall e transferred to the general f!nds of the 6overnment-G %Sec- 1N %2+ ART 7I+ $ # If a President of the Philippines spent a special f!nd for a general p!rpose9 he can e charged with c!lpa le violation of the )onstit!tionX7III- SUPRE;E )'URTBS P'=ER '/ RE7IE= FThe S!preme )o!rt shall have the power to review9 revise9 reverse9 modify or affirm on appeal or certiorari9 all cases involving the legality of any ta" imposed9 assessment9 or toll9 or any penalty imposed in relation thereto-G %Sec- ? %1*+ ART 7III+ $ # )ongress cannot ta3e away from the S!preme )o!rt the power given to it y the )onstit!tion as the final ar iter of the ta" cases(E5E6ATE( AUT<'RITY T' 5')A5 6'7ER&;E&T U&ITS F Each local government !nit shall have the power to create its own so!rces of reven!es and to levy ta"es9 fees9 and charges s! 8ect to s!ch g!idelines and limitations as the )ongress may provide9 consistent with the asic policy of local a!tonomy- S!ch ta"es9 fees9 charges shall have e"cl!sivity to the local government-G %Sec- ?9 ART X+ 5I;ITATI'&S '& P'=ER T' TAX %5-6-U-+

0+ 5aw granting any ta" e"emption # a sol!te ma8ority 1+ 5aw withdrawing any ta" e"emption # Relative ma8ority $$ # Ta" e"emption9 amnesties9 ref!nds are considered in the nat!re of ta" e"emptions # A law granting s!ch needs approval of the a sol!te ma8ority of the )ongress &' USE '/ PU*5I) ;'&EY 'R PR'PERTY /'R PU*5I) PURP'SES $ # F &o p! lic money or property shall e appropriated9 applied9 paid9 or employed9 directly or indirectly9 for the !se9 enefit9 or s!pport of any sect9 ch!rch9 denomination9 sectarian9 instit!tion or system of religion9 or of any priest9 preacher9 minister or other religio!s teacher or dignitary as s!ch9 EX)EPT when s!ch priest9 preacher9 minister or dignitary is assigned to the armed forces9 or to any penal instit!tion9 or government orphanage or leprosari!m as s!chG %Sec- 1N %1+ ART 7I+ $ # P! lic property may e leased to a religio!s gro!p provided that the lease will e totally !nder the same conditions as that to private persons %amo!nt of rent+

0+ It is s! 8ect to s!ch g!idelines and limitations provided y )ongress1+ It m!st e consistent with the asic policy of local a!tonomy2+ S!ch ta"es9 fees9 and charges shall accr!e e"cl!sively to the local governmentRU5ES> &ATI'&A5 6'7BT vs- 56U I;P'SITI'& '/ TAXES 0+ The &ational 6overnment may impose local ta"es on articles or s! 8ects which are within the territorial 8!risdiction of the local government !nit1+ The 5ocal 6overnment !nit cannot impose ta" on the national government# Yo! can only ta" those articles9 which are within yo!r 8!risdiction

SE)- Q9 ART X F local government !nits shall have a 8!st share9 as determined y law9 in the national ta"es which shall e a!tomatically released to them-G AX EXE;PTI'&S '/ E(U)ATI'&A5 I&STITUTI'&S F All reven!es and assets of non-stoc39 non-profit ed!cational instit!tions !sed act!ally9 directly9 and e"cl!sively for ed!cational p!rposes shall e e"empt from ta"es and d!ties-G %Sec- : %2+ ART XI7+ RE.UISITES /'R EXE;PTI'&> 0+ It m!st e a private ed!cational instit!tion 1+ It m!st e non-stoc3 and non-profit 2+ ItBs assets %property+ and reven!es %income+ m!st e !sed act!ally9 directly and e"cl!sively for ed!cational p!rposes RU5ES> 0+ If the first re,!isite is a sent %meaning9 itBs a government ed!cational instit!tion+9 it is nonetheless e"empt from income ta" 1+ If the second re,!irement is a sent %meaning9 it is stoc3 and profit+ as long as the third re,!irement is present9 it is nonetheless e"empt from real estate ta" 2+ If the third re,!irement is a sent9 as long as it is nonstoc3 and non-profit9 it is nonetheless e"empt from income ta" :+ If the third re,!irement is a sent9 !t it is private and non-profit9 it is s! 8ect to income ta"9 !t at the preferential rate of ten percent %0OI+ $ # Under the present ta" code9 for a private ed!cational instit!tion to e e"empt from the payment of income ta"9 all it has to e is non-stoc3 and non- profit- <owever9 a governmental ed!cational instit!tion is e"empt from income ta" witho!t any condition EXE;PTI'& ('ES &'T EXTE&( T'> 0+ Income derived y these ed!cational instit!tions from their property9 real or personal9 and 1+ /rom activities cond!cted y them for profit regardless of the disposition made on s!ch income TAX EXE;PTI'& '/ ('&ATI'&S for E(U)ATI'&A5 PURP'SES $ # FS! 8ect to conditions prescri ed y law9 all grants endowments9 donations9 or contri !tions !sed act!ally9 directly and e"cl!sively for ed!cational p!rposes shall e e"empt from ta"-G %Sec- : %:+ ART XI7+ XXII- &' EXP'ST /A)T' 5A= PR'<I*ITI'& I& TAXATI'& /ER&A&(EM vs- /ER&A&(EM $ # The prohi ition against Fe" post facto lawsG applies only to criminal laws and not to those that concern civil matters '!r ta" laws are civil in nat!re $ # The collection of interest on ta"es is not penal in nat!re and the e" post facto law prohi ition does not apply to it

Section 129. Power to Create Sources of Revenue. - Each local government !nit shall e"ercise its power to create its own so!rces of reven!e and to levy ta"es9 fees9 and charges s! 8ect to the provisions herein9 consistent with the asic policy of local a!tonomy- S!ch ta"es9 fees9 and charges shall accr!e e"cl!sively to the local government !nitsSection 132. Local Taxing Authority. - The power to impose a ta"9 fee9 or charge or to generate reven!e !nder this )ode shall e e"ercised y the sangg!nian of the local government !nit concerned thro!gh an appropriate ordinanceSection 137. Franchise Tax. - &otwithstanding any e"emption granted y any law or other special law9 the province may impose a ta" on !sinesses en8oying a franchise9 at the rate not e"ceeding fifty percent %?OI+ of one percent %0I+ of the gross ann!al receipts for the preceding calendar year ased on the incoming receipt9 or reali@ed9 within its territorial 8!risdictionIn the case of a newly started !siness9 the ta" shall not e"ceed one-twentieth %0R1O+ of one percent %0I+ of the capital investment- In the s!cceeding calendar year9 regardless of when the !siness started to operate9 the ta" shall e ased on the gross receipts for the preceding calendar year9 or any fraction thereon9 as provided herein Section 157. Individuals Liable to Co unity Tax. - Every inha itant of the Philippines eighteen %0H+ years of age or over who has een reg!larly employed on a wage or salary asis for at least thirty %2O+ consec!tive wor3ing days d!ring any calendar year9 or who is engaged in !siness or occ!pation9 or who owns real property with an aggregate assessed val!e of 'ne tho!sand pesos %P09OOO-OO+ or more9 or who is re,!ired y law to file an income ta" ret!rn shall pay an ann!al additional ta" of /ive pesos %P?-OO+ and an ann!al additional ta" of 'ne peso %P0-OO+ for every 'ne tho!sand pesos %P09OOO-OO+ of income regardless of whether from !siness9 e"ercise of profession or from property which in no case shall e"ceed /ive tho!sand pesos %P?9OOO-OO+In the case of h!s and and wife9 the additional ta" herein imposed shall e ased !pon the total property owned y them and the total gross receipts or earnings derived y themSection 158. !uridical Persons Liable to Co unity Tax. Every corporation no matter how created or organi@ed9 whether domestic or resident foreign9 engaged in or doing !siness in the Philippines shall pay an ann!al comm!nity ta" of /ive h!ndred pesos %P?OO-OO+ and an ann!al additional ta"9 which9 in no case9 shall e"ceed Ten tho!sand pesos %P0O9OOO-OO+ in accordance with the following sched!le> %0+ /or every /ive tho!sand pesos %P?9OOO-OO+ worth of real property in the Philippines owned y it d!ring the preceding year ased on the val!ation !sed for the payment of real property ta" !nder e"isting laws9 fo!nd in the assessment rolls of the city or m!nicipality where the real property is sit!ated - Two pesos %P1-OO+S and %1+ /or every /ive tho!sand pesos %P?9OOO-OO+ of gross receipts or earnings derived y it from its !siness in the Philippines d!ring the preceding year - Two pesos %P1-OO+The dividends received y a corporation from another corporation however shall9 for the p!rpose of the additional ta"9 e considered as part of the gross receipts or earnings of said corporation-