TAXATION I – MIDTERMS
1. TAXATION, a power and a mode.
Taxation is the inherent power of the sovereign exercised
through the legislature to impose burdens upon subjects and
objects within its jurisdiction for the purpose of raising
revenues to carry out the legitimate objects of government.
It is the mode of raising revenue for public purposes.
It is the power by which the sovereign raises revenue to
defray the expenses of government. It is a way of
apportioning the cost of government among those who in
some measure are privileged to enjoy its benefits and must
bear its burden.
2. NON-REVENUE PURPOSES OF TAXATION (RIPE)
a. Reduce social inequality
b. Implement the Police Power of the State
c. Protect our local industries against unfair competition
d. Encourage the growth of local industries.
3. PRINCIPLE OF SOUND TAX SYSTEM (FAT)
Fiscal Adequacy – sources of revenues must be adequate
to meet government expenditures and other public needs.
This is in consonance with the doctrine that taxes are the
lifeblood of the government.
Administrative Feasibility – Tax laws must be capable of
effective and efficient enforcement. They must not obstruct
business growth and economic development.
Theoretical Justice – A sound tax system must take into
consideration the taxpayer’s ability to pay. Our laws mandate
that taxes must be reasonable, just, fair and conscionable.
Under the constitution, the rule of taxation must be uniform
and equitable.
4. Ruling of first impression – refers to the rulings,
opinions and interpretations of the Commissioner with respect
to the provisions of the Tax Code and other tax laws without
established precedents. They likewise refer to reversal,
modification or revocation of any existing ruling. Under
Section 7 of the Tax Code, the Commissioner may not
delegate to his subordinate the issuance of these rulings.
Validity. It must be the first ever ruling issued by the CIR on
that particular tax issue. It must also be within the scope of the
authority granted to the CIR, and should not contravene any
law or regulation or any decision of the Supreme Court..
5. Ruling with established precedents – refer to mere
reiteration of previous rulings, opinions and interpretations
of the Commissioner, as delegated to duly authorized internal
revenue officers
Validity. Rulings with established precedents shall be valid
unless revoked by the Secretary of Finance. Copies of these
rulings and issuances, with attached copies of its precedents
shall be submitted to the Secretory of Finance within five (5)
days from the date of such ruling.
Revocation and Modification. A ruling may be revoked or
modified for any number of reasons such as when the facts
as represented are discovered to be different from what is
represented or not accord with the current views of the
Commissioner.
6. Binding effect of the administrative issuances or
Revenue Regulations
Binding only to the persons to whom the ruling or circular is
addressed unless the ruling is in the nature of a general
interpretation rule being a response to a query made not by a
particular taxpayer but by a government agency tasked to
perform specific function for the benefit of the public in
general.
7. Non-retroactivity of Rulings, exceptions
General Rule: Rulings are not retroactive if they are
prejudicial to the taxpayer. (Sec. 246, NIRC)
Exceptions:
1. Where the taxpayer deliberately misstates or omits
material facts from his return or any document required
of him by the BIR.
2. Where the facts subsequently gathered by the BIR is
materially different from the facts on which the ruling is
based.
3. Where the taxpayer acted in bad faith.
8. Minimum Compromise Rates of any tax liability
a. In case of financial incapacity:
MCR= 10% of the basic assessed tax
b. Other cases: MCR= 40% of the basic assessed tax [Sec.
204(A), 1997 NIRC]
9. Instances when BIR Commissioner has authority
to inquire bank deposits
a. Where the taxpayer has authorized the Commissioner
to make an inquiry;
b. Where the inquiry is made in decedent’s bank account
to determine his gross estate;
c. Where the inquiry is made in the deposit account of any
taxpayer who has filed an application for compromise of
his tax liability for reason of financial incapacity to pay
his tax liability.
d. Where the inquiry is made in the deposit account of a
specific taxpayer or taxpayers subject of a request for
the supply of tax information from a foreign tax authority
10. Taxpayer’s suit, requisites:
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
Note: 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. 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.[48] In
cases where serious legal issues were raised or where public
expenditures of millions of pesos were involved, the court did
not hesitate to give standing to taxpayers.
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11. UNGAB DOCTRINE
An assessment of a deficiency is not necessary to a criminal
prosecution for willful attempt to defeat and evade the
income tax. A crime is complete when the violator has
knowingly and willfuly filed a fraudulent return with intent to
evade and defeat the tax. The perpetration of the crime is
grounded upon knowledge on the part of the taxpayer that
he has made an inaccurate return, and the government's
failure to discover the error and promptly to assess has no
connections with the commission of the crime.
12. Non-stock, Non-Profit Education Institution
Basis: All revenues and assets use ACTUALLY,
DIRECTLY, EXCLUSIVELY for educational purposes shall
be exempt from taxes and duties. (Article XIV, Sec 4)
Requisites for Exemption
Real Property when use for educational purposes
Tax
Income Tax, Revenues and income regardless of
VAT, Buss. Tax source used actually, directly and
exclusively for educational
purposes.
Donors Tax Not more than 30% of gifts used for
administration purposes (sec 101,
NIRC)
13. Charitable/religious Institutions
Basis: 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. (Art. VI, Sec. 28 (3), Constitution)
Requisites for Exemption
Real Real property must be actually, directly,
Property and exclusively for charitable purposes
Tax
ADE used – means the direct and
immediate and actual application of the
property itself to the purposes for which
the charitable institution is organized
and not the use of the income from
the real property. (Lung Center v. QC)
Income Tax 1. Must be a non-stock corporation or
association;
2. Organized exclusively for charitable
purposes;
3. Operated exclusively for charitable
purposes; and
4. No part of its net income or assets
shall belong to or inure to the benefit
of any member, organizer, officer or
any specific person
A charitable institution is allowed to
engage in “activities conducted for profit”
without losing its tax exempt status for its
non-for-profit activities. The only
consequence is that such income shall
be subject to tax. (CIR v. St. Lukes)
TAXATION I – MIDTERMS
Donors Tax Not more than 30% of gifts used for
administration purposes (sec 101,
NIRC)
14. General Professional Partnership are partnerships formed
by persons for the sole purpose of exercising their common
profession, no part of the income of which is derived from
engaging in any trade or business.
15. Income of Proprietary Educational Institutions and Non-
Profit Hospitals
Proprietary educational institutions and hospitals which are
non-profit shall pay a tax of ten percent (10%) on their taxable
income,
except those covered by Subsection (D) hereof:
1. Interest from Deposits and Yield or any other
Monetary Benefit from Deposit Substitutes and from
Trust Funds and Similar Arrangements, and Royalties.
2. Capital Gains from the Sale of Shares of Stock Not
Traded in the Stock Exchange.
3. Tax on Income Derived under the Expanded Foreign
Currency Deposit System.
4. Intercorporate Dividends
5. Capital Gains Realized from the Sale, Exchange or
Disposition of Lands and/or Buildings.
16. Predominance test - if gross income from unrelated trade,
business or other activity exceeds 50% of the total gross
income from all sources, ENTIRE taxable income shall be
subject to the REGULAR corporate tax rate of 30% (35% -
2006-2008)
17. Unrelated trade, business or other activity - any trade,
business or other activity, the conduct of which is not
substantially related to the exercise or performance by such
educational institution or hospital of its primary purpose or
function.
18. Section 27 (B), NIRC (for recall purposes)
Ang mga non-profit na pribadong eskwelahan at mga ospital
ay magbabayad ng sampung porsyentong (10%) tax sa
kanilang taxable income maliban sa mga nakasaad sa
Subsection (D): Subalit, kung mahigit singkwenta porsyento
ng kanilang kabuuang kinita ay nagmula sa mga kalakal,
negosyo, o anumang gawain na walang kinalaman sa
pangunahing layunin ng eskwelahan o ng ospital, ang
nasabing eskwelahan o ospital ay magbabayad ng trenta
porsyentong (30%) tax sa lahat ng kanilang kabuuang kita.
19. IMPROPERLY ACCUMULATED EARNING TAX
This is the income tax imposed on a corporation if its
earnings and profits are accumulated (undistributed)
instead of being divided and distributed to its
stockholders.
An improperly accumulated earnings tax (IAET) equal
to 10% is imposed for each taxable year on the
improperly accumulated taxable income of each
corporation.
20. IMMEDIACY TEST- is used to determine the
“reasonable needs” of business” in order to justify an
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accumulation of earnings. Under this test, the term
"reasonable needs of the business" are hereby construed
to mean the immediate needs of the business, including
reasonably anticipated needs. The corporation should be
able to prove an immediate need for the accumulation of
the earnings and profits, or the direct correlation of
anticipated needs to such accumulation of profits.
Otherwise, such accumulation would be deemed to be
not for the reasonable needs of the business, and the
penalty tax would apply.
21. What is the purpose and nature of IAET?
The imposition of IAET discouraged tax avoidance through
corporate surplus accumulation. When corporations do not
declare dividends, income taxes are not paid on the
undeclared dividends received by the shareholders. The tax
on improper accumulation of surplus is essentially a penalty
tax designed to compel corporations to distribute earnings so
that the said earnings by shareholders could, in turn, be
taxed (see CYNAMID PHILIPPINES INC VS. CA
[JANUARY 20, 2000])
The IAET is being imposed in the nature of a penalty to the
corporation for the improper accumulation of its earnings,
and as a form of deterrent to the avoidance of tax upon
shareholders who are supposed to pay dividends tax on the
earnings distributed to them by the corporation (see RR 2-
01 [FEBRUARY 12, 2001]).
22. What is the main factor to consider in holding a
corporation liable for IAET?
The touchstone of the liability is the purpose behind the
accumulation of the income and not the consequences of
the accumulation. Thus, if the failure to pay dividends is
due to some other causes, such as the use of undistributed
earnings and profits for the reasonable needs of the
business, such purpose would not generally make the
accumulated or undistributed earnings subject to the
tax. However, if there is a determination that a
corporation has accumulated income beyond the
reasonable needs of the business, the 10% improperly
accumulated earnings tax shall be imposed.
23. MINIMUM CORPORATE INCOME TAX (mcit)
A minimum corporate income tax of 2% of gross income
shall be imposed on a domestic corporation
and resident foreign corporation beginning on the
fourth taxable year immediately following the year in
which such corporation commenced its business operations
when:
1. the MCIT is greater than the NCIT for the
taxable year.
2. such operation has zero or negative taxable
income
24. CORP.TAXPAYERS EXEMPTED FROM MCIT
1. Resident foreign corporations engaged in business
as international carriers
2. Resident foreign corporations engaged as OBUs
3. Resident foreign corporations engaged in business
as ROHQs
4. Firms that are taxed under a special income tax
regime.
TAXATION I – MIDTERMS
25. Relief from the Minimum Corporate Income Tax
Under Certain Conditions. - The Secretary of Finance is
hereby authorized to suspend the imposition of the minimum
corporate income tax on any corporation which suffers losses
on account of prolonged labor dispute, or because of force
majeure, or because of legitimate business reverses.
The Secretary of Finance is hereby authorized to promulgate,
upon recommendation of the Commissioner, the necessary
rules and regulations that shall define the terms and
conditions under which he may suspend the imposition of the
minimum corporate income tax in a meritorious case.
26. Tax Benefit Rule – The recovery of bad debts previously
allowed as a deduction in the preceding year or years shall
be included as part of the taxpayer’s gross income in the year
of such recovery to the extent of the income tax benefit of
said deduction (RR No. 05-99)
dis-tin-guish
TAXATION v. POLICE POWER v. EMINENT DOMAIN
a. As to purpose, the purpose of taxation is to raise revenue;
the purpose of police power is to promote public welfare
through regulations; and the purpose of eminent domain is
to facilitate the taking of private property for public use.
b. As to amount of exaction, in taxation, it is unlimited in
amount; in police power, it is limited only to the cost of
regulation, issuance of license or surveillance, and in
eminent domain, there is no exaction, but private property
is taken by the State for public purpose.
c. As to benefits received, in taxation, no special or direct
benefit is received by the taxpayer, merely general benefit
of protection, in police power, no direct benefit is also
received, but a healthy economic standard of society is
attained; and in eminent domain, a direct benefit results in
the form of just compensation to the property owner.
d. As to non-impairment of contracts, in taxation, contract
may not be impaired; in police power and eminent domain,
contracts may be impaired.
e. As to transfer of property rights, in taxation, taxes paid
become part of public funds; in police power, there is no
transfer but only restraint in its exercise, and in eminent
domain, the transfer is effected in favor of the State.
f. As to scope, taxation covers all person, property, and
excises; police power covers all person, property, rights,
and privileges; and eminent domain covers only a
particular property.
g. As to who may exercise the power, taxation and police
power are exercised only by the government or its political
subdivisions, and eminent domain may be exercised by
private entities.
TAXPAYER’S SUIT v. CITIZEN’ SUIT
In Taxpayer’s suit, the right of a citizen and a taxpayer to
maintain an action in courts to restrain the unlawful use of public
funds to his injury cannot be denied.
In Citizen’s suit, which is in the matter of public right, the people
are the real parties, it is at least the right, if not the duty, of every
citizen to intervene and see that a public offense be properly
pursued and punished, and a public grievance be remedied.
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COMPROMISE v. ABATEMENT
Compromise is the remedy that may be resorted to when there
is:
(i) a reasonable doubt as to the validity of the claim against
the taxpayer exists; or
(ii) the financial position of the taxpayer demonstrates a
clear inability to pay the assessed tax.
Abatement, by contrast, is the remedy that may resorted to
when:
(i) the tax or any portion thereof appears to be unjustly or
excessively assessed; or
(ii) The administration and collection costs involved do not
justify the collection of the amount due.
All criminal violations may be compromised except:
(a) those already filed in court, or
(b) those involving fraud. (Section 204 of the NIRC).
TAX AMNESTY v. TAX EXEMPTION
TAX AMNESTY – is an immunity from all criminal and civil
obligations arising from anon-payment of taxes. It is a general
pardon given to all taxpayers. It partakes of an absolute waiver
by the government of its right to collect what is due it and to five
tax evaders who wish to relent a chance to start with a clean
slate. It applies only to past tax periods, hence of retractive
application.
TAX EXEMPTION – is an immunity from the civil liability only. It
is an immunity or privilege, a freedom from a charge or burden
of which others are subjected. It is generally prospective in
application.
re-cent bar ques-tions
San Juan University is a non-stock, non-profit educational
institution. It owns a piece of land in Caloocan City on
which its three 2-storey school buildings stood. Two of the
buildings are devoted to classrooms, laboratories, a
canteen, a bookstore and administrative offices. The third
building is reserved as dormitory for student athletes who
are granted scholarships for a given academic year.
In 2017, San Juan University earned income from tuition
fees and from leasing a portion of its premises to various
concessionaires of food, books, and school supplies.
(a) Can the City Treasurer of Caloocan City collect real
property taxes on the land and building of San Juan
University? Explain your answer.
SUGGESTED ANSWER:
No, the City Treasurer cannot collect real property taxes on the
land and building of San Juan University, except for the leased
premises to concessionaires.
Real property actually, directly, and exclusively used for
educational purposes are exempted by the Constitution from
real property taxes.
Here, only the property leased to concessionaries, which are for
commercial use, are not actually, directly, and exclusively used
for educational purposes. Hence, only the property leased to
concessionaries may be assessed for real property taxes.
TAXATION I – MIDTERMS
(b) Is the income earned by San Juan University for the year
2017 subject to income tax?
No, the income earned by San Juan University in 2017 is not
subject to income tax.
Income earned by non-stock, non-profit educational institutions
actually, directly, and exclusively used for educational purposes
is not subject to income tax.
Here, there is no indication that the income was not for
educational purposes.
Hence, the income is not subject to income tax.
Globesmart Services, Inc. received a final assessment
notice with formal letter of demand from the BIR for
deficiency income tax, value-added tax and withholding tax
for the taxable year 2016 amounting to P48 million.
Globesmart Services, Inc. filed a protest against the
assessment, but the Commissioner of Internal Revenue
denied the protest. Hence, Globesmart Services, Inc. filed a
petition for review in the CTA with an urgent motion to
suspend the collection of tax.
After hearing, the CTA Division issued a resolution granting
the motion to suspend but required Globesmart Services,
Inc. to post a surety bond equivalent to the deficiency
assessment within 15 days from notice of the resolution.
Globesmart Services, Inc. moved for the partial
reconsideration of the resolution and for the reduction of
the bond to an amount it could obtain. The CTA Division
issued another resolution reducing the amount of the
surety bond to Jl24 million. The latter amount was still more
than the net worth of Globesmart Services, Inc. as reported
in its audited financial statements.
(a) May the collection of taxes be suspended?
Yes, the collection of taxes may be suspended.
Under Section 11 of RA 1125, as amended, collection of taxes
may be suspended when in the opinion of the CTA, it may
jeopardize the interest of the Government and/or the taxpayer.
The CTA at any stage of the proceeding may suspend the
collection of taxes and require the taxpayer either to deposit the
amount claimed or to file a surety bond for not more than double
the amount with the CTA.
(b) Is the CTA Division justified in requiring Globesmart
Services, Inc. to post a surety bond as a condition for the
suspension of the deficiency tax collection?
No, the CTA Division is not justified in requiring Globesmart to
post a surety bond.
Jurisprudence provides that the CTA should first conduct a
preliminary hearing to determine whether posting of the surety
bond is necessary or the amount thereof is justified.
Here, the CTA did not conduct such preliminary hearing, where
it could have found that the surety bond required is more than
Globesmart’s net worth.
No, the CTA Division is not justified in requiring Globesmart to
post a surety bond.
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ca-se: c-i-r v. la-sall-e
The tax-exemption constitutionally-granted to non-stock, non
profit educational institutions, is not subject to limitations
imposed by law.
The tax exemption granted by the Constitution to non-
stock, non-profit educational institutions is conditioned
only on the actual, direct and exclusive use of their assets,
revenues and income for educational purposes.
We find that unlike Article VI, Section 28 (3) of the
Constitution (pertaining to charitable institutions, churches,
parsonages or convents, mosques, and non-profit cemeteries),
which exempts from tax only the assets, i.e., "all lands,
buildings, and improvements, actually, directly, and
exclusively used for religious, charitable, or educational
purposes...," Article XIV, Section 4 (3) categorically states
that "[a]ll revenues and assets... used actually, directly, and
exclusively for educational purposes shall be exempt from
taxes and duties."
The addition and express use of the word revenues in Article
XIV, Section 4 (3) of the Constitution is not without significance.
We find that the text demonstrates the policy of the 1987
Constitution, discernible from the records of the 1986
Constitutional Commission to provide broader tax privilege to
non-stock, non-profit educational institutions as recognition of
their role in assisting the State provide a public good. The tax
exemption was seen as beneficial to students who may
otherwise be charged unreasonable tuition fees if not for the
tax exemption extended to all revenues and assets of non-
stock, non-profit educational institutions.
Further, a plain reading of the Constitution would show that
Article XIV, Section 4 (3) does not require that the revenues
and income must have also been sourced from educational
activities or activities related to the purposes of an educational
institution. The phrase all revenues is unqualified by any
reference to the source of revenues. Thus, so long as the
revenues and income are used actually, directly and
exclusively for educational purposes, then said revenues and
income shall be exempt from taxes and duties. 81
We find it helpful to discuss at this point the taxation
of revenues versus the taxation of assets.
Revenues consist of the amounts earned by a person or entity
from the conduct of business operations. It may refer to the
sale of goods, rendition of services, or the return of an
investment. Revenue is a component of the tax base in income
tax,83 VAT,84 and local business tax (LBT).85
Assets, on the other hand, are the tangible and intangible
properties owned by a person or entity.86 It may refer to real
estate, cash deposit in a bank, investment in the stocks of a
corporation, inventory of goods, or any property from which the
person or entity may derive income or use to generate the
same. In Philippine taxation, the fair market value of real
property is a component of the tax base in real property tax
(RPT).87 Also, the landed cost of imported goods is a
TAXATION I – MIDTERMS
component of the tax base in VAT on importation88 and tariff
duties.89
Thus, when a non-stock, non-profit educational institution
proves that it uses its revenues actually, directly, and
exclusively for educational purposes, it shall be exempted from
income tax, VAT, and LBT. On the other hand, when it also
shows that it uses its assets in the form of real property for
educational purposes, it shall be exempted from RPT.
To be clear, proving the actual use of the taxable item will result
in an exemption, but the specific tax from which the entity shall
be exempted from shall depend on whether the item is an item
of revenue or asset.
To illustrate, if a university leases a portion of its school building
to a bookstore or cafeteria, the leased portion is not actually,
directly and exclusively used for educational purposes, even if
the bookstore or canteen caters only to university students,
faculty and staff.
The leased portion of the building may be subject to real
property tax, as held in Abra Valley College, Inc. v.
Aquino.90 We ruled in that case that the test of exemption from
taxation is the use of the property for purposes mentioned in
the Constitution. We also held that the exemption extends to
facilities which are incidental to and reasonably necessary for
the accomplishment of the main purposes.
In concrete terms, the lease of a portion of a school building for
commercial purposes, removes such asset from the property
tax exemption granted under the Constitution.91 There is no
exemption because the asset is not used actually, directly and
exclusively for educational purposes. The commercial use of
the property is also not incidental to and reasonably necessary
for the accomplishment of the main purpose of a university,
which is to educate its students.
However, if the university actually, directly and exclusively
uses for educational purposes the revenues earned from the
lease of its school building, such revenues shall be exempt
from taxes and duties. The tax exemption no longer hinges on
the use of the asset from which the revenues were earned, but
on the actual, direct and exclusive use of the revenues for
educational purposes.
Parenthetically, income and revenues of non-stock, non-profit
educational institution not used actually, directly and
exclusively for educational purposes are not exempt from
duties and taxes. To avail of the exemption, the taxpayer
must factually prove that it used actually, directly and
exclusively for educational purposes the revenues or income
sought to be exempted.
The crucial point of inquiry then is on the use of the assets or
on the use of the revenues. These are two things that must
be viewed and treated separately. But so long as the assets or
revenues are used actually, directly and exclusively for
educational purposes, they are exempt from duties and taxes.
The tax exemption granted by the Constitution to non-
stock, non-profit educational institutions, unlike the
exemption that may be availed of by proprietary
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 TAXATION I – MIDTERMS

educational institutions, is not subject to limitations

imposed by law.

That the Constitution treats non-stock, non-profit educational

institutions differently from proprietary educational institutions
cannot be doubted. As discussed, the privilege granted to the
former is conditioned only on the actual, direct and exclusive
use of their revenues and assets for educational purposes. In
clear contrast, the tax privilege granted to the latter may be
subject to limitations imposed by law.

We spell out below the difference in treatment if only to

highlight the privileged status of non-stock, non-profit
educational institutions compared with their proprietary
counterparts.

While a non-stock, non-profit educational institution is

classified as a tax-exempt entity under Section 30 (Exemptions
from Tax on Corporations) of the Tax Code, a proprietary
educational institution is covered by Section 27 (Rates of
Income Tax on Domestic Corporations).

To be specific, Section 30 provides that exempt organizations

like non-stock, non-profit educational institutions shall not be
taxed on income received by them as such.

Section 27 (B), on the other hand, states that [p]roprietary

educational institutions...which are nonprofit shall pay a tax of
ten percent (10%) on their taxable income...Provided, that if the
gross income from unrelated trade, business or other activity
exceeds fifty percent (50%) of the total gross income derived
by such educational institutions...[the regular corporate income
tax of 30%] shall be imposed on the entire taxable income... 92

By the Tax Code's clear terms, a proprietary educational

institution is entitled only to the reduced rate of 10% corporate
income tax. The reduced rate is applicable only if: (1) the
proprietary educational institution is non profit and (2) its gross
income from unrelated trade, business or activity does not
exceed 50% of its total gross income.

Consistent with Article XIV, Section 4 (3) of the Constitution,

these limitations do not apply to non-stock, non-profit
educational institutions.

Thus, we declare the last paragraph of Section 30 of the Tax

Code without force and effect for being contrary to the
Constitution insofar as it subjects to tax the income and
revenues of non-stock, non-profit educational institutions used
actually, directly and exclusively for educational purpose. We
make this declaration in the exercise of and consistent with our
duty93 to uphold the primacy of the Constitution.94

Finally, we stress that our holding here pertains only to non-

stock, non-profit educational institutions and does not cover the
other exempt organizations under Section 30 of the Tax Code.

For all these reasons, we hold that the income and revenues
of DLSU proven to have been used actually, directly and
exclusively for educational purposes are exempt from duties
and taxes.

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