1. CITY OF PASIG vs.

PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT - Real Property Tax

Category: Local Taxation

CITY OF PASIG vs. PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT- Real Property Tax
FACTS:
MPLDC owned two parcels of land in Pasig City. In 1986, Jose Y. Campos, the registered owner of MPLDC, voluntarily surrendered MPLDC to the government. From 2002-2005, Pasig City sent notices of assessment to MPLDC to demand payment of real property taxes. PCGG filed with the RTCC a petition for prohibition with a prayer for issuance of a TRO claiming ownership over the said properties.

ISSUE:
Are the properties owned by PCGG subject to real property taxes?

HELD:
Only those portions of the properties leased to taxable entities are subject to real estate taxes for the period of such leases and may also be sold at public auctioned to satisfy the tax delinquency. While it was established that the owner of the properties is now clearly the Republic of the Philippines given the voluntary surrender, the Local Government Code clearly states that the exemption will not apply when the beneficial use thereof has been granted, for consideration or otherwise, to a taxable person. The Court cited several cases to support the decision such as Philippine Fisheries, GSIS, MIAA, and Lung Center.

2. QUEZON CITY vs. ABS-CBN BROADCASTING CORPORATION - Local Franchise Tax

Category: Local Taxation

QUEZON CITY vs. ABS-CBN BROADCASTING CORPORATION - Local Franchise Tax

FACTS:
ABS-CBN was granted a franchise which provides that it shall pay a 3% franchise tax and the said percentage tax shall be in lieu of all taxes on this franchise or earnings thereof. It thus filed a complaint against the imposition of local franchise tax.

ISSUE:
Does the in lieu of all taxes provision in ABS-CBNs franchise exempt it from payment of the local franchise tax?

HELD:
NO. The right to exemption from local franchise tax must be clearly established beyond reasonable doubt and cannot be made out of inference or implications. The uncertainty over whether the in lieu of all taxes provision pertains to exemption from local or national taxes, or both, should be construed against Respondent who has the burden to prove that it is in fact covered by the exemption claimed. Furthermore, the in lieu of all taxes clause in Respondents franchise has become ineffective with the abolition of the franchise tax on broadcasting companies with yearly gross receipts exceeding P10 million as they are now subject to the VAT.

3.