Professional Documents
Culture Documents
TAXATION
Taxation is the inherent power of the sovereign, exercised through the legislature,
to impose burdens upon the subjects and objects within its jurisdiction, for the
purpose of raising revenues to carry out legitimate objects of the government.
It is also defined as the act of levying a tax, i.e. the process or means by which
the sovereign, through its law-making body, raises income to defray the necessary
expenses of government. It is a method of apportioning the cost of government
among those who, in some measure are privileged to enjoy its benefits and must
therefore bear its burdens. (De Leon)
It is a mode of raising revenue for public purposes. (Cooley)
Symbiotic relationship between the government and the citizens.
TAXES
Taxes are the enforced proportional contributions from persons and property
levied by the law-making body of the State by virtue of its sovereignty for the
support of the government and all public needs. (Cooley)
They are not arbitrary exactions but contributions levied by authority of law, and
by some rule of proportion which is intended to ensure uniformity of contribution
and a just apportionment of the burdens of government.
1. NECESSITY THEORY
Taxation is a power predicated upon necessity. It is a necessary burden to
preserve the State’s sovereignty and a means to give the citizenry an army
to resist aggression, a navy to defend its shores from invasion, a corps of civil
servants to serve, public improvements for the enjoyment of the citizenry,
and those which come within the State’s territory and facilities and
protection which a government is supposed to provide. (Phil. Guaranty Co.,
Inc. v, Commissioner 13 SCRA 7775)
This doctrine is enunciated in CIR v. Algue, Inc. (158 SCRA 9, February 17, 1988)
which states that “Taxes are what we pay for civilized society. Without taxes,
the government would be paralyzed for lack of 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 must
contribute his share in the burden of running 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
material and moral values.”
1. FISCAL ADEQUACY
The sources of revenues must be adequate to meet government
expenditures. (Chavez v. Ongpin, 186 SCRA 331)
Even if a tax law violates the principle of Fiscal Adequacy and the proceeds
may not be sufficient to satisfy the needs of the government, still the tax law
is valid.
2. THEORETICAL JUSTICE
The tax burden should be in proportion to the taxpayer’s ability to pay.
(ABILITY TO PAY PRINCIPLE)
Equitable Taxation has been mandated by our constitution, as if taxes are
unjust and unreasonable then they are not equitable, thus invalid.
3. ADMINISTRATIVE FEASIBILITY
The tax law must be capable of effective or efficient enforcement.
There is no law that requires compliance with this principle, so even if the
tax law violates this principle, such tax law is valid.
Law creating the CTA- Republic Act No. 1125, June 15, 1954
The creation of the CTA is for the purpose of having a centralized body well
versed in tax matters- a regular court forming part of the judicial system which
could exclusively hear and determine tax cases; and,
To prevent delay in the disposition of tax cases in view of backlog of civil and
criminal cases in the regular courts. (Ursal v. CA 101 Phil 209)
CTA shall exercise exclusive appellate jurisdiction to review by appeal the ff:
The ancillary jurisdiction of the CTA such as the power to issue writs of
prohibition and injunction is only SUPPLEMENTARY to its appellate jurisdiction.
The power to issue writs exists only in cases appealed to it. There has to be a
main action first pending before it.
NATURE OF THE CTA
It is judicial and not an administrative body.
It is a court of special jurisdiction, and as such can only take cognizance of
such matters as are clearly within its jurisdiction.
It is not governed strictly by the technical rules of evidence.
QUORUM
Any two judges of the CTA shall constitute a quorum and the concurrence of
two judges shall be necessary to promulgate any decision thereof.
The principles of local taxation under the 1987 Constitution simply means
“Decentralization”. It does not mean that local governments are sovereigns
within the state or “imperium in imperia”.
2. Procedure for approval and effectivity of tax ordinance and revenue measures
and Procedure for Protest of tax ordinance
The procedure for approval of local tax ordinances and revenue measures
shall be in accordance with the provisions of the Local Government Code. #