1. COMMISSIONER OF INTERNAL REVENUE, Petitioner vs.

DE LA SALLE UNIVERSITY, INC., Respondent

G.R. No. 196596 November 9, 2016

Issues

I. Whether DLSU' s income and revenues proved to have been used actually, directly and
exclusively for educational purposes are exempt from duties and taxes;

Before fully discussing the merits of the case, we observe that:

First, the constitutional provision refers to two kinds of educational institutions:

(1) non-stock, non-profit educational institutions and
(2) proprietary educational institutions.

The DLSU falls under the first category. Even the Commissioner admits the status of DLSU as a
non-stock, non-profit educational institution.

While DLSU's claim for tax exemption arises from and is based on the Constitution, the
Constitution, in the same provision, also imposes certain conditions to avail of the exemption. We
discuss below the import of the constitutional text vis-a-vis the Commissioner's counter-arguments.

Fourth, there is a marked distinction between the treatment of non-stock, non-profit educational
institutions and proprietary educational institutions. The tax exemption granted to non-stock, non-
profit educational institutions is conditioned only on the actual, direct and exclusive use of their
revenues and assets for educational purposes. While tax exemptions may also be granted to
proprietary educational institutions, these exemptions may be subject to limitations imposed by
Congress.

While the present petition appears to be a case of first impression,71 the Court in the YMCA case
had in fact already analyzed and explained the meaning of Article XIV, Section 4 (3) of the
Constitution. The Court in that case made doctrinal pronouncements that are relevant to the
present case.

The issue in YMCA was whether the income derived from rentals of real property owned by the
YMCA, established as a "welfare, educational and charitable non-profit corporation," was subject
to income tax under the Tax Code and the Constitution.72

The Court denied YMCA's claim for exemption on the ground that as a charitable institution falling
under Article VI, Section 28 (3) of the Constitution,73 the YMCA is not tax-exempt per se; " what
is exempted is not the institution itself... those exempted from real estate taxes are lands, buildings
and improvements actually, directly and exclusively used for religious, charitable or educational
purposes."74

The Court held that the exemption claimed by the YMCA is expressly disallowed by the last
paragraph of then Section 27 (now Section 30) of the Tax Code, which mandates that the income
of exempt organizations from any of their properties, real or personal, are subject to the same tax
imposed by the Tax Code, regardless of how that income is used. The Court ruled that the last
paragraph of Section 27 unequivocally subjects to tax the rent income of the YMCA from its
property.75

In short, the YMCA is exempt only from property tax but not from income tax.

As a last ditch effort to avoid paying the taxes on its rental income, the YMCA invoked the tax
privilege granted under Article XIV, Section 4 (3) of the Constitution.

The Court denied YMCA's claim that it falls under Article XIV, Section 4 (3) of the Constitution
holding that the term educational institution, when used in laws granting tax exemptions, refers to
the school system (synonymous with formal education); it includes a college or an educational
establishment; it refers to the hierarchically structured and chronologically graded learnings
organized and provided by the formal school system.76
The Court then significantly laid down the requisites for availing the tax exemption under Article
XIV, Section 4 (3), namely: (1) the taxpayer falls under the classification non-stock, non-profit
educational institution; and (2) the income it seeks to be exempted from taxation is used actually,
directly and exclusively for educational purposes.77

We now adopt YMCA as precedent and hold that:

1. The last paragraph of Section 30 of the Tax Code is without force and effect with respect to non-
stock, non-profit educational institutions, provided, that the non-stock, non-profit educational
institutions prove that its assets and revenues are used actually, directly and exclusively for
educational purposes.

2. The tax-exemption constitutionally-granted to non-stock, non-profit educational institutions, is

not subject to limitations imposed by law.

II. Whether the entire assessment should be voided because of the defective LOA;

A LOA is the authority given to the appropriate revenue officer to examine the books of account
and other accounting records of the taxpayer in order to determine the taxpayer's correct internal
revenue liabilities95 and for the purpose of collecting the correct amount of tax,96 in accordance
with Section 5 of the Tax Code, which gives the CIR the power to obtain information, to
summon/examine, and take testimony of persons. The LOA commences the audit process97 and
informs the taxpayer that it is under audit for possible deficiency tax assessment.

The relevant provision is Section C of RMO No. 43-90, the pertinent portion of which reads:

3. A Letter of Authority [LOA] should cover a taxable period not exceeding one taxable year. The
practice of issuing [LO As] covering audit of unverified prior years is hereby prohibited. If the audit
of a taxpayer shall include more than one taxable period, the other periods or years shall be
specifically indicated in the [LOA].98

What this provision clearly prohibits is the practice of issuing LOAs covering audit of unverified
prior years. RMO 43-90 does not say that a LOA which contains unverified prior years is void. It
merely prescribes that if the audit includes more than one taxable period, the other periods or
years must be specified. The provision read as a whole requires that if a taxpayer is audited for
more than one taxable year, the BIR must specify each taxable year or taxable period on separate
LOAs.

Read in this light, the requirement to specify the taxable period covered by the LOA is simply to
inform the taxpayer of the extent of the audit and the scope of the revenue officer's authority.
Without this rule, a revenue officer can unduly burden the taxpayer by demanding random
accounting records from random unverified years, which may include documents from as far back
as ten years in cases of fraud audit.99

In the present case, the LOA issued to DLSU is for Fiscal Year Ending 2003 and Unverified Prior
Years. The LOA does not strictly comply with RMO 43-90 because it includes unverified prior
years. This does not mean, however, that the entire LOA is void.

As the CTA correctly held, the assessment for taxable year 2003 is valid because this taxable
period is specified in the LOA. DLSU was fully apprised that it was being audited for taxable year
2003. Corollarily, the assessments for taxable years 2001 and 2002 are void for having been
unspecified on separate LOAs as required under RMO No. 43-90.
III. Whether the CTA correctly admitted DLSU's supplemental pieces of evidence; and

The Commissioner objects to the CTA Division's admission of DLSU's supplemental pieces of
documentary evidence.

To recall, DLSU formally offered its supplemental evidence upon filing its motion for
reconsideration with the CTA Division.103 The CTA Division admitted the supplemental evidence,
which proved that a portion of DLSU's rental income was used actually, directly and exclusively for
educational purposes. Consequently, the CTA Division reduced DLSU's tax liabilities.

We uphold the CTA Division's admission of the supplemental evidence on distinct but mutually
reinforcing grounds, to wit: (1) the Commissioner failed to timely object to the formal offer of
supplemental evidence; and (2) the CTA is not governed strictly by the technical rules of evidence.

First, the failure to object to the offered evidence renders it admissible, and the court cannot, on
its own, disregard such evidence.104

The Court has held that if a party desires the court to reject the evidence offered, it must so state
in the form of a timely objection and it cannot raise the objection to the evidence for the first time
on appeal.105 Because of a party's failure to timely object, the evidence offered becomes part of
the evidence in the case. As a consequence, all the parties are considered bound by any outcome
arising from the offer of evidence properly presented.106

As disclosed by DLSU, the Commissioner did not oppose the supplemental formal offer of
evidence despite notice.107 The Commissioner objected to the admission of the supplemental
evidence only when the case was on appeal to the CTA En Banc. By the time the Commissioner
raised her objection, it was too late; the formal offer, admission and evaluation of the supplemental
evidence were all fait accompli.

We clarify that while the Commissioner's failure to promptly object had no bearing on the materiality
or sufficiency of the supplemental evidence admitted, she was bound by the outcome of the CTA
Division's assessment of the evidence.108

Second, the CTA is not governed strictly by the technical rules of evidence. The CTA Division's
admission of the formal offer of supplemental evidence, without prompt objection from the
Commissioner, was thus justified.

Notably, this Court had in the past admitted and considered evidence attached to the taxpayers'
motion for reconsideration.1âwphi1

In the case of BPI-Family Savings Bank v. Court of Appeals,109 the tax refund claimant attached
to its motion for reconsideration with the CT A its Final Adjustment Return. The Commissioner, as
in the present case, did not oppose the taxpayer's motion for reconsideration and the admission
of the Final Adjustment Return.110 We thus admitted and gave weight to the Final Adjustment
Return although it was only submitted upon motion for reconsideration.

We held that while it is true that strict procedural rules generally frown upon the submission of
documents after the trial, the law creating the CTA specifically provides that proceedings before it
shall not be governed strictly by the technical rules of evidence111 and that the paramount
consideration remains the ascertainment of truth. We ruled that procedural rules should not bar
courts from considering undisputed facts to arrive at a just determination of a controversy.112

We applied the same reasoning in the subsequent cases of Filinvest Development Corporation v.
Commissioner of Internal Revenue113 and Commissioner of Internal Revenue v. PERF Realty
Corporation,114 where the taxpayers also submitted the supplemental supporting document only
upon filing their motions for reconsideration.

Although the cited cases involved claims for tax refunds, we also dispense with the strict
application of the technical rules of evidence in the present tax assessment case. If anything, the
liberal application of the rules assumes greater force and significance in the case of a taxpayer
who claims a constitutionally granted tax exemption. While the taxpayers in the cited cases claimed
refund of excess tax payments based on the Tax Code,115 DLSU is claiming tax exemption based
on the Constitution. If liberality is afforded to taxpayers who paid more than they should have under
a statute, then with more reason that we should allow a taxpayer to prove its exemption from tax
based on the Constitution.

Hence, we sustain the CTA's admission of DLSU's supplemental offer of evidence not only
because the Commissioner failed to promptly object, but more so because the strict application of
the technical rules of evidence may defeat the intent of the Constitution.

IV. Whether the CTA's appreciation of the sufficiency of DLSU's evidence may be disturbed
by the Court.

It is doctrinal that the Court will not lightly set aside the conclusions reached by the CTA which, by
the very nature of its function of being dedicated exclusively to the resolution of tax problems, has
developed an expertise on the subject, unless there has been an abuse or improvident exercise
of authority.116 We thus accord the findings of fact by the CTA with the highest respect. These
findings of facts can only be disturbed on appeal if they are not supported by substantial evidence
or there is a showing of gross error or abuse on the part of the CTA. In the absence of any clear
and convincing proof to the contrary, this Court must presume that the CTA rendered a decision
which is valid in every respect.

However, while we generally respect the factual findings of the CTA, it does not mean that we are
bound by its conclusions. In the present case, we do not agree with the method used by the CTA
to arrive at DLSU' s unsubstantiated rental income.

DLSU should be liable only for the difference between what it claimed and what it has proven. In
more concrete terms, DLSU only had to prove that its rental income for taxable year 2003
(₱10,610,379.00) was used for educational purposes. Hence, while the total disbursements from
the CF-CPA Account amounted to ₱23,463,543.02, DLSU only had to substantiate its Pl0.6 million
rental income, part of which was the ₱6,602,655.00 transferred to the CF-CPA account. Of this
latter amount, ₱6.259 million was substantiated to have been used for educational purposes.
2. COMMISSIONER OF INTERNAL REVENUE, Petitioner
vs.ST. LUKE’S MEDICAL CENTER, INC., Respondent
G.R. No. 203514 February 13, 2017

The doctrine of stare decisis dictates that "absent any powerful countervailing considerations, like
cases ought to be decided alike."

This Petition for Review on Certiorari under Rule 45 of the Rules of Court assails the May 9, 2012
Decision3 and the September 17, 2012 Resolution4 of the Court of Tax Appeals (CTA) in CTA EB
Case No. 716.

Ruling of the Court of Tax Appeals Division

On August 26, 2010, the CTA Division rendered a Decision13 finding SLMC not liable for deficiency
income tax under Section 27(B) of the 1997 NIRC, as amended, since it is exempt from paying
income tax under Section 30(E) and (G) of the same Code.

CIR 's Arguments

CIR argues that under the doctrine of stare decisis SLMC is subject to 10% income tax under
Section 27(B) of the 1997 NIRC.29 It likewise asserts that SLMC is liable to pay compromise
penalty pursuant to Section 248(A)30 of the 1997 NIRC for failing to file its quarterly income tax
returns.31

As to the alleged payment of the basic tax, CIR contends that this does not render the instant case
moot as the payment confirmation submitted by SLMC is not a competent proof of payment of its
tax liabilities.32

SLMC's Arguments

SLMC, on the other hand, begs the indulgence of the Court to revisit its ruling in G.R. Nos. 195909
and 195960 (Commissioner of Internal Revenue v. St. Luke's Medical Center, Inc.)33 positing that
earning a profit by a charitable, benevolent hospital or educational institution does not result in the
withdrawal of its tax exempt privilege.34 SLMC further claims that the income it derives from
operating a hospital is not income from "activities conducted for profit."35 Also, it maintains that in
accordance with the ruling of the Court in G.R. Nos. 195909 and 195960 (Commissioner of Internal
Revenue v. St. Luke's Medical Center, Inc.),36 it is not liable for compromise penalties.37

In any case, SLMC insists that the instant case should be dismissed in view of its payment of the
basic taxes due for taxable years 1998, 2000-2002, and 2004-2007 to the BIR on April 30, 2013.

RULING:

An organization may be considered as non-profit if it does not distribute any part of its income to
stockholders or members. However, despite its being a tax exempt institution, any income such
institution earns from activities conducted for profit is taxable, as expressly provided in the last
paragraph of Section 30.

To be a charitable institution, however, an organization must meet the substantive test of charity
in Lung Center. The issue in Lung Center concerns exemption from real property tax and not
income tax. However, it provides for the test of charity in our jurisdiction. Charity is essentially a
gift to an indefinite number of persons which lessens the burden of government. In other words,
charitable institutions provide for free goods and services to the public which would otherwise fall
on the shoulders of government. Thus, as a matter of efficiency, the government forgoes taxes
which should have been spent to address public needs, because certain private entities already
assume a part of the burden. This is the rationale for the tax exemption of charitable institutions.
The loss of taxes by the government is compensated by its relief from doing public works which
would have been funded by appropriations from the Treasury.

Charitable institutions, however, are not ipso facto entitled to a tax exemption. The requirements
for a tax exemption are specified by the law granting it. The power of Congress to tax implies the
power to exempt from tax. Congress can create tax exemptions, subject to the constitutional
provision that '[n]o law granting any tax exemption shall be passed without the concurrence of a
majority of all the Members of Congress.' The requirements for a tax exemption are strictly
construed against the taxpayer because an exemption restricts the collection of taxes necessary
for the existence of the government.

There is no dispute that St. Luke's is organized as a non-stock and non-profit charitable institution.
However, this does not automatically exempt St. Luke's from paying taxes. This only refers to the
organization of St. Luke's. Even if St. Luke's meets the test of charity, a charitable institution is not
ipso facto tax exempt. To be exempt from real property taxes, Section 28(3), Article VI of the
Constitution requires that a charitable institution use the property 'actually, directly and exclusively'
for charitable purposes. To be exempt from income taxes, Section 30(E) of the NIRC requires that
a charitable institution must be 'organized and operated exclusively' for charitable purposes.
Likewise, to be exempt from income taxes, Section 30(G) of the NIRC requires that the institution
be 'operated exclusively' for social welfare.

The Court finds that St. Luke's is a corporation that is not 'operated exclusively' for charitable or
social welfare purposes insofar as its revenues from paying patients are concerned. This ruling is
based not only on a strict interpretation of a provision granting tax exemption, but also on the clear
and plain text of Section 30(E) and (G). Section 30(E) and (G) of the NIRC requires that an
institution be 'operated exclusively' for charitable or social welfare purposes to be completely
exempt from income tax. An institution under Section 30(E) or (G) does not lose its tax exemption
if it earns income from its for-profit activities. Such income from for-profit activities, under the last
paragraph of Section 30, is merely subject to income tax, previously at the ordinary corporate rate
but now at the preferential 10% rate pursuant to Section 27(B).

A tax exemption is effectively a social subsidy granted by the State because an exempt institution
is spared from sharing in the expenses of government and yet benefits from them. Tax exemptions
for charitable institutions should therefore be lin1ited to institutions beneficial to the public and
those which improve social welfare. A profit-making entity should not be allowed to exploit this
subsidy to the detriment of the government and other taxpayers.

St. Luke's fails to meet the requirements under Section 30(E) and (G) of the NIRC to be completely
tax exempt from all its income. However, it remains a proprietary non-profit hospital under Section
27(B) of the NIRC as long as it does not distribute any of its profits to its members and such profits
are reinvested pursuant to its corporate purposes. St. Luke's, as a proprietary non-profit hospital,
is entitled to the preferential tax rate of 10% on its net income from its for-profit activities.

However, in view of the payment of the basic taxes made by SLMC on April 30, 2013, the instant
Petition has become moot. The Large Taxpayers Service of the BIR dated May 27, 2013, and the
letter from the BIR dated November 26, 2013 with attached Certification of Payment and
application for abatement are sufficient to prove payment especially since CIR never questioned
the authenticity of these documents.

3.
4. SOUTHERN LUZON DRUG CORPORATION, Petitioner, vs.
THE DEPARTMENT OF SOCIAL WELFARE AND DEVELOPMENT, THE NATIONAL COUNCIL
FOR THE WELFARE OF DISABLED PERSONS, THE DEPARTMENT OF FINANCE, and THE
BUREAU OF INTERNAL REVENUE, Respondents
G.R. No. 199669 April 25, 2017

Before the Court is a Petition for Review on Certiorari1under Rule 45 of the Rules of Court,
assailing the Decision2 dated June 17, 2011, and Resolution3 dated November 25, 2011 of the
Court of Appeals (CA) in CA-G.R. SP No. 102486, which dismissed the petition for prohibition filed
by Southern Luzon Drug Corporation (petitioner) against the Department of1 Social Welfare and
Development (DSWD), the National Council for the Welfare of Disabled Persons (NCWDP) (now
National Council on Disability Affairs or NCDA), the Department of Finance (DOF) and the Bureau
of: Internal Revenue (collectively, the respondents), which sought to prohibit the implementation
of Section 4(a) of Republic Act (R.A.) No. 9257, otherwise known as the "Expanded Senior Citizens
Act of 2003" and Section 32 of R.A. No. 9442, which amends the "Magna Carta for Disabled
Persons," particularly the granting of 20% discount on the purchase of medicines by senior citizens
and persons with disability (PWD),: respectively, and treating them as tax deduction.

The petitioner is a domestic corporation engaged in the business of: drugstore operation in the
Philippines while the respondents are government' agencies, office and bureau tasked to monitor
compliance with R.A. Nos. 9257 and 9442, promulgate implementing rules and regulations for their
effective implementation, as well as prosecute and revoke licenses of erring1 establishments.

Assailing the constitutionality of Section 4(a) of R.A. No. 9257 primarily on the ground that it
amounts to taking of private property without payment of just compensation. In a Decision dated
June 29, 2007, the Court upheld the constitutionality of the assailed provision, holding that the
same is a legitimate exercise of police power.

The law is a legitimate exercise of police power which, similar to the power of
eminent domain, has general welfare for its object. Police power is not capable of
an exact definition, but has been purposely veiled in general terms to underscore
its comprehensiveness to meet all exigencies and provide enough room for an
efficient and flexible response to conditions and circumstances, thus assuring the
greatest benefits. Accordingly, it has been described as "the most essential,
insistent and the least limitable of powers, extending as it does to all the great
public needs." It is "[t]he power vested in the legislature by the constitution to make,
ordain, and establish all manner of wholesome and reasonable laws, statutes, and
ordinances, either with penalties or without, not repugnant to the constitution, as
they shall judge to be for the good and welfare of the commonwealth, and of the
subjects of the same."

For this reason, when the conditions so demand as determined by the legislature,
property rights must bow to the primacy of police power because property rights,
though sheltered by due process, must yield to general welfare.

There is also no question regarding the jurisdiction of the CA to hear and decide a petition for
prohibition. By express provision of the law, particularly Section 9(1) of Batas Pambansa Bilang
129,27 the CA was granted "original jurisdiction to issue writs of mandamus, prohibition, certiorari,
habeas corpus, and quo warranto, and auxiliary writs or I processes, whether or not in aid of its
appellate jurisdiction." This authority· the CA enjoys concurrently with RTCs and this Court.

In the same manner, the supposed violation of the principle of the ·. hierarchy of courts does not
pose any hindrance to the full deliberation of the issues at hand. It is well to remember that "the
judicial hierarchy of courts is not an iron-clad rule. It generally applies to cases involving warring
factual allegations. For this reason, litigants are required to [refer] to the trial courts at the first
instance to determine the truth or falsity of these contending allegations on the basis of the
evidence of the parties. Cases which depend on disputed facts for decision cannot be brought
immediately before appellate courts as they are not triers of facts. Therefore, a strict application of
the rule of hierarchy of courts is not necessary when the cases brought before the appellate courts
do not involve factual but legal questions."28
Moreover, the principle of hierarchy of courts may be set aside for special and important reasons,
such as when dictated by public welfare and ' the advancement of public policy, or demanded by
the broader interest of justice.29 Thus, when based on the good judgment of the court, the urgency
and significance of the issues presented calls for its intervention, it should not hesitate to exercise
its duty to resolve.

The instant petition presents an exception to the principle as it basically raises a legal question on
the constitutionality of the mandatory discount and the breadth of its rightful beneficiaries. More
importantly, the resolution of the issues will redound to the benefit of the public as it will put to rest
the questions on the propriety of the granting of discounts to senior citizens and PWDs amid the
fervent insistence of affected establishments that the measure transgresses their property rights.
The Court, therefore, finds it to the best interest of justice that the instant petition be resolved.

The instant case is not barred by stare decisis

The Court agrees that the ruling in Carlos Superdrug does not constitute stare decisis to the instant
case, not because of the petitioner's submission of financial statements which were wanting
in the first case, but because it had the good sense of including questions that had not been
raised or deliberated in the former case of Carlos Superdrug, i.e., validity of the 20% discount
granted to PWDs, the supposed vagueness of the provisions of R.A. No. 9442 and violation of the
equal protection clause.

Nonetheless, the Court finds nothing in the instant case that merits a reversal of the earlier ruling
of the Court in Carlos Superdrug. Contrary to the petitioner's claim, there is a very slim difference
between the issues in Carlos Superdrug and the instant case with respect to the nature of the
senior citizen discount. A perfunctory reading of the circumstances of the two cases easily
discloses marked similarities in the issues and the arguments raised by the petitioners in both
cases that semantics nor careful play of words can hardly obscure.

Verily, it is the bounden duty of the State to care for the elderly as they reach the point in their lives
when the vigor of their youth has diminished and resources have become scarce. Not much
because of choice, they become needing of support from the society for whom they presumably
spent their productive days and for whose betterment they' exhausted their energy, know-how and
experience to make our days better to live.

In the same way, providing aid for the disabled persons is an equally important State responsibility.
Thus, the State is obliged to give full support to the improvement of the total well-being of disabled
persons and their integration into the mainstream of society. 32This entails the creation of
opportunities for them and according them privileges if only to balance the playing field which had
been unduly tilted against them because of their limitations.

The duty to care for the elderly and the disabled lies not only upon the State, but also on the
community and even private entities. As to the State, the duty emanates from its role as parens
patriae which holds it under obligation to provide protection and look after the welfare of its people
especially those who cannot tend to themselves. Parens patriae means parent of his or her
country, and refers to the State in its role as "sovereign", or the State in its capacity as a provider
of protection to those unable to care for themselves. 33 In fulfilling this duty, the State may resort
to the exercise of its inherent powers: police power, eminent domain and power of taxation.

The petitioner, however, claims that the change in the tax treatment of the discount is illegal
as it constitutes taking without just compensation. It even submitted financial statements for
the years 2006 and 2007 to support its claim of declining profits when the change in the policy was
implemented.

The Court is not swayed.

To begin with, the issue of just compensation finds no relevance in the instant case as it had
already been made clear in Carlos Superdrug that the power being exercised by the State in the
imposition of senior citizen discount was its police power. Unlike in the exercise of the power of
eminent domain, just compensation is not required in wielding police power. This is precisely
because there is no taking involved, but only an imposition of burden.

Still, the petitioner argues that the law is confiscatory in the sense that the State takes away a
portion of its supposed profits which could have gone into its coffers and utilizes it for public
purpose. The petitioner claims that the action of the State amounts to taking for which it should be
compensated.

To reiterate, the subject provisions only affect the petitioner's right to profit, and not earned profits.
Unfortunately for the petitioner, the right to profit is not a vested right or an entitlement that has
accrued on the person or entity such that its invasion or deprivation warrants compensation.
Vested rights are "fixed, unalterable, or irrevocable."

Right to profits does not give the petitioner the cause of action to ask for just compensation, it
being only an inchoate right or one that has not fully developed50 and therefore cannot be claimed
as one's own. An inchoate right is a mere expectation, which may or may not come into existence.
It is contingent as it only comes "into existence on an event or condition which may not happen or
be performed until some other event may prevent their vesting."51 Certainly, the petitioner cannot
claim confiscation or taking of something that has yet to exist. It cannot claim deprivation of profit
before the consummation of a sale and the purchase by a senior citizen or PWD.

Right to profit is not an accrued right; it is not fixed, absolute nor indefeasible. It does not come
into being until the occurrence or realization of a condition precedent. It is a mere "contingency
that might never eventuate into a right. It stands for a mere possibility of profit but nothing might
ever be payable under it."52

The inchoate nature of the right to profit precludes the possibility of compensation because it lacks
the quality or characteristic which is necessary before any act of taking or expropriation can be
effected. Moreover, there is no yardstick fitting to quantify a contingency or to determine
compensation for a mere possibility. Certainly, "taking" presupposes the existence of a subject that
has a quantifiable or determinable value, characteristics which a mere contingency does not
possess.

Anent the question regarding the shift from tax credit to tax deduction, suffice it is to say that
it is within the province of Congress to do so in the exercise of its legislative power. It has the
authority to choose the subject of legislation, outline the effective measures to achieve its declared
policies and even impose penalties in case of non-compliance. It has the sole discretion to decide
which policies to pursue and devise means to achieve them, and courts often do not interfere in
this exercise for as long as it does not transcend constitutional limitations. "In performing this duty,
the legislature has no guide but its judgment and discretion and the wisdom of experience."53 In
Carter v. Carter Coal Co.,legislative discretion has been described as follows:

Legislative congressional discretion begins with the choice of means, and ends with the
adoption of methods and details to carry the delegated powers into effect. x x x [W]hile the
powers are rigidly limited to the enumerations of the Constitution, the means which may be
employed to carry the powers into effect are not restricted, save that they must be
appropriate, plainly adapted to the end, and not prohibited by, but consistent with, the letter
and spirit of the Constitution. x x x.
5.