Beruflich Dokumente
Kultur Dokumente
Local Taxation
1222. Distinguish local taxation f r o m internal r e v e n u e tax a n d
real p r o p e r t y tax:
Answer.
Internal Revenue Tax
Collected
by
the
Bureau
of
Internal
Revenue
through
accredited banks
Self-assessing
Exercise by the national
government under its
inherent
power
of
taxation
1223. W h a t are
taxation?
the
Local T a x
All types of imposts
which local g o v e r n m e n t
units are e m p o w e r e d to
enact on businesses,
occupations, regulated
privileges and activities,
utility charges carried
and
within
their
respective
territorial
jurisdiction
Taxes
levied
by
provinces, cities and
municipalities on real
properties
and
their
improvements
Collected by provinces,
cities,
municipalities
and barangays
Collected by provinces
or cities w h e r e the
property is located
fundamental
principles
governing
local
Answer.
a) T h e imposition should be within the taxing authority of t h e local
government.
b)
c)
716
d)
e)
f)
g)
h)
i)
b)
c)
d)
e)
To insure that each local government will have its fair share of
available resources and that the resources of the national
government will not be unduly disturbed; and
f)
c)
718
is
the
nature
of
the
taxing
power
of
local
governments?
Answer.
a) It is not inherent
b)
c)
719
b)
c)
1232.
a)
b)
b)
2.
720
1 2 3 3 . T w o (2) a c c e p t e d p r i n c i p l e o f a p p o r t i o n i n g t h e b u r d e n o f
taxation:
Answer.
a)
b)
c)
d)
e)
721
f)
g)
h)
c)
d)
units?
(In
relation
to
the
welfare
of the
724
b)
3 5 % o n the s e c o n d year;
c)
2.
3.
4.
2 0 % thereof to barangays.
725
726
b)
c)
d)
b)
c)
d)
e)
727
the same field. This doctrine principally rests upon the intention of
the Congress.
Where the National Government elects to tax a particular area,
it impliedly withholds from the local government the delegated
power to tax the same field.
Illustration:
Under the V A T law, persons w h o are e x e m p t from the 1 2 %
VAT are subject to the 3% percentage tax which is in lieu of the
1 2 % VAT. This arises w h e n the aggregate gross taxable
sales/receipts derived by the taxpayer from all lines of businesses
and every separate and distinct establishment or place w h e r e the
business is conducted d o e s not exceed Php 1,919,500.00 (RR 162 0 1 1 , which took effect January 1, 2012) during any 12-month
period. Preemption here would m e a n that the imposition of the 3%
percentage tax on sales would impliedly preclude the imposition of
that same kind of tax by local g o v e r n m e n t units. However, so long
as the business tax being levied by the L G U s is not a sales tax,
they may proceed with the levy, (e.g., a graduated fixed tax which
is not a sales tax but a tax on the privilege of engaging in a
particular business.)
When
this
Doctrine
does
not
apply?
(Excluded
T a x e s w h i c h are levied
provided by the L G U ,
under t h e N I R C ,
b)
c)
d)
e)
f)
728
unless otherwise
b)
b)
729
c)
to
grant
local
tax
b)
T h e grant of tax e x e m p t i o n
ordinance;
c)
d)
e)
730
shall
be through
valid tax
1259. W h o s e
exemptions
were
effectivity of the L G C ?
not
withdrawn
upon
the
Answer.
a) Local water districts
b)
c)
d)
b)
c)
d)
1261. What
local
are the
common
government
units
revenue-raising
(province,
powers
municipal,
s t
day
of the
city a n d
barangay)?
Answer. All local government units are authorized to impose and
collect the following fees and charges:
a)
b)
c)
d)
e)
f)
g)
732
local
h)
i)
D o c u m e n t a r y S t a m p tax;
b)
c)
d)
733
e)
f)
g)
h)
Taxes or fees for the registration of motor vehicles and for the
issuance of all kinds of licenses or permits for the driving
thereof except tricycles;
i)
j)
k)
T h e prohibition is on t a x i n g the p r o d u c t s e x p o r t e d
a b r o a d . T h e business of exporting Philippine finished,
manufactured or p r o c e s s e d
products is T A X A B L E by
municipalities or cities. Likewise, export t a x e s , fees and other
levies m a y be i m p o s e d by local g o v e r n m e n t units on raw
materials E X P O R T E D T O F O R E I G N C O U N T R I E S .
I)
n)
o)
735
p)
q)
Light
Rail
Transit Authority
vs.
Board
of Assessment
Appeals of Mia. & City Assessor of Manila (CBAA case No.
L-06, resolved July 6, 1995)
Carriageways and terminals o w n e d by the L R T A are
subject to realty taxes of the L G U s , e v e n t h o u g h built or
attached to the national road w h i c h is the property of the
national government. T h e L R T w a s created to serve the needs
of the riding public w h o pays the required rates for the use of
the L R T system from w h i c h the Authority derived material
gains. It is not e n g a g e d in purely g o v e r n m e n t a l service entitled
to the tax e x e m p t i o n .
r)
s)
736
S e c . 1 9 ( A - 2 ) o f P D 231
T h e e x e m p t i o n is on t h e
business of exporting
Art. 48 of PD 1789
( O m n i b u s Investment Code)
The
exemption
is
on
the
products being exported.
1263. Distinguish
between
"accrual
of
tax"
and
"time
for
payment":
Answer. Accrual means when liability for the tax has attached or
begun. Local taxes, fees and charges shall accrue on the 1st day
737
" T i m e of p a y m e n t "
It refers to the date the tax is payable
without penalty. For late payment
thereof surcharge, interest and other
penalties are imposable.
Fee
Imposed for purposes of
regulations, T h e a m o u n t
is more or less equivalent
to t h e cost of regulating
the activity or privilege.
Imposed under t h e police
power of the g o v e r n m e n t
Service Charge
Imposed in payment of
services rendered by the
local g o v e r n m e n t , or for
the
convenience
furnished.
Imposed
under
the
principle of equity
738
W h o p a y s ? - T h e seller,
administrator of the property.
donor,
transferor,
executor
or
Agricultural land, if t h e transfer is f r o m landlords to tenantf a r m e r under the C o m p r e h e n s i v e Agrarian Reform Law is
taxable.
B) T a x on b u s i n e s s of printing or publication (Sec. 136) Tax on business of printing and publication except books
and materials prescribed by the D E C S as school texts,
Rate of tax - For old business, not exceeding 5 0 % of 1 % of the
gross annual receipts for the preceding calendar year. In case
of newly started business, the tax shall not exceed 1/20 of 1 %
of the capital investment.
C)
739
740
nor
contracts
but
simply
E)
Contractors of g o v e r n m e n t infrastructure
subject to sand a n d gravel tax.
Professional T a x
occupation tax)
(Sec.
139)
(sometimes
projects
referred
to
are
as
F)
742
Philippine
National
a m u s e m e n t tax.
Red
Cross
is
exempted
from
Phil.
Basketball Association
vs.
CA,
337
SCRA
358:
of
or
744
either directly or
on
real
property
such
as
t h o s e on
the
1.
2.
3.
J)
K)
L)
M)
fees,
market fees,
charges
745
for
high
2.
3.
4.
1269.
interest e a r n e d a n d
contracts receivables.
actually
collected
on
mortgage
b)
c)
d)
e)
f)
g)
h)
b)
c)
service and
other administrative
b)
the
municipal
or
city
government
collect
both
activities
of wholesaling
and
retailing
within
the
s a m e tax period?
Answer. Wholesalers w h o are at the s a m e time retailers shall be
taxed on both activities but m a y avail of the concession or the
reduced tax. (Sec. 143)
1273. W h a t
is
the
assembler,
with
situs
of
contractor,
factory,
project
business
producer
office,
tax
or
plant,
on
manufacturers,
exporter
and
(MACPE)
plantation
or
b)
c)
d)
e)
f)
g)
h)
749
invoices
j)
2.
and
controlled
insurance companies
financial
institutions"
included
and
in the term
therefore
subject
to
"other
local
business taxes?
A n s w e r . Y e s . Insurance c o m p a n i e s shall include all individuals,
partnerships, associations, corporations or G O C C s e n g a g e d as
principals in the insurance business, including their branches.
EXCEPT MUTUAL BENEFIT ASSOCIATIONS A N D PURELY
C O O P E R A T I V E S insurance associations organized under the laws
on cooperatives.
1276. What
is
the
situs
of
business
tax
on
insurance
companies?
Answer.
a) Insurance contracts or policies issued by the h e a d office or
branch office shall be recorded in said offices as the c a s e m a y
be and the p r e m i u m s and/or gross receipts due thereon shall
be subject to local business taxes;
b)
750
all
business
receipts. "X"
operating therein
based
on gross
b u s i n e s s tax
751
infrastructure
projects
locally and
752
and
relieve the
interests.
taxpayer
from
the
imposition
of
surcharges
and
b)
c)
b)
c)
754
d)
C h a r g e s for t h e operation
maintained by the city.
e)
f)
1290. W h a t are
granted?
fishery
of
privileges
public
and
to
utilities
whom
owned
are
and
they
b)
1291. May
the
city
government
impose
business
taxes
on
gasoline stations?
A n s w e r . Cities may collect business taxes on manufacturers,
wholesalers, retailers or dealers in petroleum products, but the rate
of tax thereon shall not exceed 2% of the gross sales or receipts of
the preceding year. (Sec. 143 (h), L G C )
N O T E : Sec. 133(h) prohibits the taxing of products already tax
under the N I R C , w h e r e a s , Sec. 143(h) allows the imposition on the
privilege of engaging in the "business" of manufacturing or dealing
in said products.
1292. A r e c o m m o n carriers required to pay local taxes based
on gross receipts under the Local Government Code?
Answer. No. Under Sec. 133 (I) LGC, the taxing powers of
province, municipality, city or barangay shall not extend to the levy
of taxes on the gross receipts of transportation contractors
engaged in the transportation of passengers or freight by hire and
755
Barangays:
757
Resolution
It is used whenever the legislature
wishes to express an opinion that is
to have temporary effect only.
Ordinance
It prescribes a permanent rule of
conduct of government.
It is binding not only on the
inhabitants of the municipality but
also on strangers or non-residents
coming into its territorial jurisdiction
It cannot be a m e n d e d by mere
resolution but only by another
ordinance enacted with the s a m e
formalities as the original ordinance.
Once duly enacted remains in force
until repealed, either expressly or
by necessary implication.
Resolution
It is temporary in nature.
Not necessarily so
Can
be
recalled,
revoked,
w i t h d r a w n , modified, cancelled and
revised without the formalities of
law anytime.
As
it
pertains
temporarily
to
ministerial duties, they may be
implemented
until cancelled or
replaced.
revenue
measures
are
enacted
by
the
local
government?
Answer.
a) Prior to the e n a c t m e n t of any tax ordinance or revenue
measure, public hearing shall be conducted for the purpose,
which shall be in the following manner:
b)
1. Within t e n (10) d a y s f r o m filing of any p r o p o s e d tax
ordinance or r e v e n u e m e a s u r e , t h e s a m e must first be
published for three (3) consecutive d a y s in a n e w s p a p e r of
local circulation or shall be posted simultaneously in at
least two (2) c o n s p i c u o u s public places within t h e territorial
jurisdiction of t h e local g o v e r n m e n t unit c o n c e r n e d .
2.
3.
758
4.
5.
c)
d)
e)
'
Answer.
a)
It must not contravene the Constitution or statute;
b)
c)
d)
759
unfair,
unjust,
confiscatory;
2.
b)
c)
d)
3.
4.
A tax ordinance shall go into effect on the 10th day after its
approval by the local chief executive.
N O T E : Fixing of a m o u n t and rate of local tax cannot be
delegated to administrative officials.
b)
761
in restraint of trade.
legality
of
tax
ordinance
or
2.
It does not affect the jurisdiction of the court over the case,
as it merely implies absence of a cause of action. (Pineda
vs. CFI ofDavao, 50 O.G. 5266)
2.
The failure to raise in the trial court the issue of nonexhaustion of administrative remedies prevents a party
from invoking it on appeal.
763
764
under
protest
until
final
b)
765
II.
c)
d)
Coercive Means
1.
to
2.
766
c)
may
be
pursued
alternatively
or
NOTES:
3
Unless otherwise provided under the LTC, all local taxes, fees,
and charges shall accrue on the first day of January of each
year. N e w taxes or fees or charges shall accrue on the first day
of the quarter next following the effectivity of the ordinance
imposing such new taxes or rates.
Unless otherwise prqvided in the LTC, all local taxes, fees, and
charges shall be paid within the first 20 days of January or of
e a c h subsequent quarter as the case may be. The Sanggunian
concerned may for a justifiable reason or cause extend the
time for payment of such taxes, fees, or charges without
surcharges or penalties but only for a period not exceeding 6
months.
1312. Can
the
local
sanggunian
of
the
local
government
condone taxes?
Answer. In the case of De Mesa vs. Collector of Internal Revenue,
53 Phil. 342, it w a s held that a municipal license (regulatory) tax
already in existence shall be subject to change only by ordinance
767
businesses
1315.
L T C (Sec. 61)
What
amounts
due
the local g o v e r n m e n t
are e n f o r c e d ?
W h a t properties are
subject to the lien?
H o w d o e s the lien
rank in relation to
other claims against
the t a x p a y e r ?
H o w m a y the lien be
enforced?
H o w m a y the lien be
removed?
1316. Mechanics
and
Local taxes
revenues
and
R P T C (Sec. 56)
other
Only the real property tax
or
of
By
appropriate
administrative or judicial
action
L a w is silent, (rules on
liens in general, including
payment of the a m o u n t
due will apply
procedure
on
distraint
of
personal
770
b.
c.
d.
e.
f.
g.
h.
to
assess
and/or
collect
b)
c)
d)
against collection
of local
t a x e s a r e m e d y a v a i l a b l e to a t a x p a y e r ?
A n s w e r . Unlike the N I R C , the Local Tax Code does not specifically
prohibit injunction agamst the collection of local taxes. The
procedural rules m a y thus apply. This ancillary remedy may be
resorted to if irreparable d a m a g e would be caused to the taxpayer
by the collection of the tax and no other adequate remedy is
available to him. (Physical Therapy Asso. vs. Manila, 101 Phil.
1142; Zaragoza vs. Alfonso, 46 Phil. 159) Injunction cannot be
issued pending a case on the tax ordinance simply because it is
alleged to be unconstitutional or invalid. Until so declared, the
presumption is that it is valid and constitutional. (Valley Trading vs.
CFI, March 4, 1989).
R e m e d y - For taxpayer to pay the tax and thereafter claim a
refund within the prescribed period.
773
Administrative r e m e d i e s :
1. Prior
to Assessment -
Assessment-
tax:
a)
b)
c)
d)
4. After payment
of the
tax
B.
Judicial r e m e d i e s :
1.
2.
Mandamus;
Action for tax refund (If action is
indebiti, protest is not needed); and
5. Action
for annulment
of tax
based
on
solutio
ordinance.
Special
r e m e d i e s such as personal appeal to a n d
p e r s u a d i n g the authorities c o n c e r n e d or thru mass action or
"people's people" m a y be resorted to.
777
NOTE: These three (3) separate periods ("30-30-60") are given for
compliance as a pre-requisite before seeking redress in a
competent court. (Jardine Davies Insurance Brokers, Inc. vs.
Aliposa)
1327. Define a tax period as u s e d in local t a x a t i o n :
Answer. It is the time span within which a current tax obligation is
in effect and collectible, usually coinciding with the calendar year
and payable in quarterly installments.
NOTE: Tax period does not apply to permit fees and public utility
charges.
1328. W h e n are p e r m i t f e e s a n d utility c h a r g e s p a y a b l e ?
Answer. Permit fees and utility charges are in the nature of
payments to defray the e x p e n s e s incurred by the local unit for
services rendered in the inspection or regulation of a particular
business or activity, generally they have no time s p a n s but are
payable immediately, after the rendition of t h e service.
1329. C a n the local legislative b o d y validly grant e x t e n s i o n of
time of p a y m e n t of local taxes without penalty?
A n s w e r . It may, for justifiable reason or c a u s e , extend the time for
the payment of a tax, fee or c h a r g e without penalty for a period not
exceeding six (6) m o n t h s . S u c h as the o c c u r r e n c e of flood,
t y p h o o n , earthquake, volcano eruption or other calamity w h i c h may
have recently ravaged t h e locality.
1330. W h o
may examine
books
of accounts
and
records
of
b u s i n e s s m e n for p u r p o s e s of local t a x e s ?
A n s w e r . Under Sec. 171 of t h e L G C , only the treasurer of the local
government unit imposing the tax, fee or c h a r g e , m a y e x a m i n e the
books of accounts and pertinent records of b u s i n e s s m e n in order to
ascertain, assess and collect the correct a m o u n t thereof.
Consequently, no personnel in t h e Offices of the Provincial
Governor or City or Municipal M a y o r m a y inspect records of
businessmen unless duly deputized in writing by the local treasurer
concerned.
778
779
Local government units and their officials are not exempt from
liability for death or injury to person or persons or d a m a g e to
property.
780
781
P A R T XIII
COMMUNITY
DEVELOPMENT TAX
This is a tax for being a resident and m e m b e r of a community. It
used to be known as Residence tax or "Cedula". This tax is collectible
by the city or municipal treasurer w h o can deputize the barangay
treasurers in the collection thereof in their respective territorial
jurisdiction.
The cedula tax was the first individual tax imposed in the
Philippines during the Spanish regime. It w a s abolished in 1937 but
restored under C.A. No. 4 6 5 in the form of residence tax, now k n o w n
as community development tax.
1333. Governing law on C o m m u n i t y Tax:
Answer. Sec. 38 of the Local T a x C o d e g o v e r n s the levy,
collection, and administration of the residence tax by the national
government through the BIR as well as the rates and accrual of the
proceeds thereof.
1334. Nature of C o m m u n i t y Tax:
Answer. T h e c o m m u n i t y tax is essentially a poll or capitation tax. It
is of a fixed a m o u n t i m p o s e d u p o n certain inhabitants of the
Philippines "without regard to their property or on the occupation in
which they may be e n g a g e d . "
1335. W h o are authorized to levy c o m m u n i t y tax?
A n s w e r . Cities and Municipalities.
1336. C o m p o s i t i o n of a c o m m u n i t y tax:
A n s w e r . Tax proper or the basic tax (Class A) a n d additional tax
(Class B).
782
2.
is e n g a g e d in b u s i n e s s or o c c u p a t i o n ; or
T h e business or o c c u p a t i o n need not be taxable under
the N I R C .
3.
4.
783
NOTE:
Estates of deceased
persons,
being
neither
corporations nor individuals, A R E NOT subject to the tax, but
the heirs must declare their proportionate shares of the income.
3
784
If the tax is not paid within the time prescribed, there shall be
added to the unpaid a m o u n t an interest of 2 4 % per a n n u m
from the d u e date until it is paid.
785
The provisions on community tax are located in Sees. 156 164 of the Local Government C o d e of 1 9 9 1 .
and
b)
786
c)
d)
e)
f)
g)
787
PART XIV
The appraisal
equitable.
and
assessment
of
real
property
shall
be
788
vs.
Busueao
(1980)
789
Central
Board
of Assessment
Appeals.
790
or
special
a s s e s s m e n t which
is
not
792
794
1359.
DEFINITION OF TERMS:
795
after deducting
>
Mineral land - Is a land in w h i c h minerals, metallic or nonmetallic exist in sufficient quantity or g r a d e to justify the
necessary expenditures to extract and utilize s u c h materials.
>
797
Trees, plants, and growing fruits, while they are attached to the
land or form an integral part of an immovable;
798
1364. W h a t kind of
property tax?
real
properties
are
exempt
from
real
799
Machinery
shall
embrace
machines,
equipment,
mechanical
contrivances,
instruments,
appliances
and
apparatuses, attached to the real estate. It shall include the
physical facilities available for production, as well as the
installation and appurtenant service facilities, together with all
those not permanently attached to the real estate but are
actually, directly a n d essentially u s e d to meet the needs of the
particular industry, business, or w o r k s , w h i c h by their very
nature and purpose are d e s i g n e d for or essential to
manufacturing, c o m m e r c i a l , m i n i n g , industry or agricultural
purposes. (Sec. 3-m, P.D. No. 4 6 4 as a m e n d e d by P.D. No.
1383)
3
M a c h i n e r y and e q u i p m e n t
environmental protection.
used
for
pollution
control
and
local
governments
have the
p o w e r t o e x e m p t real
2)
3)
municipality or
b)
c)
1367. Classifications
purposes:
of
real
properties
Answer.
a)
b)
c)
d)
e)
Residential
Agricultural
Commercial
Industrial
Mineral
f)
g)
for
assessment
b)
c)
d)
1 3 6 9 . W h a t a r e t h e a s s e s s m e n t levels t o b e a p p l i e d t o t h e fair
m a r k e t value of real properties for taxation p u r p o s e s ?
Who fixes the assessment levels? - S a n g g u n i a n g Panlalawigan
or P a n l u n g s o d of the place w h e r e the property is located.
At what rates? At rates not exceeding the following:
Classification
Land
Buildings and
other
Structures
(FMV)
803
Assessment
levels
20%
50%
40%
50%
50%
20%
0%
10%
20%
25%
30%
35%
40%
50%
60%
Agricultural
(FMV)
Commercial or
Industrial
(FMV)
Timberland
Machineries
Classification
Special classes
of property:
25%
30%
35%
40%
45%
50%
30%
35%
40%
50%
60%
70%
75%
80%
45%
50%
55%
60%
65%
70%
40%
50%
80%
80%
~~
Assessment
levels
15%
15%
15%
10%
10%
~n
805
are
the
duties
of
persons,
natural
or juridical,
b)
c)
806
property or of a
is
the
probative
value
of
property
tax
declaration?
Answer. While by itself it is not an adequate proof of ownership, it
may serve as sufficient basis for inferring possession. It proves that
the holder has a claim of title over the property - aside from
manifesting a sincere desire to obtain title thereto, they announce
the holder's adverse claim against the state and other interested
parties. (Olegario vs. Man, 608 SCRA 134)
807
1381. May
the
City
Assessor
amend
fair
schedules
of
real
properties
within
jurisdiction?
market
value
its
territorial
Answer. T h e City A s s e s s o r m a y r e c o m m e n d a m e n d m e n t s to
correct errors in valuation in fair market schedules to the
Sanggunian P a n l u n s o d . T h e S a n g g u n i a n P a n l u n s o d shall, by
ordinance, act on the r e c o m m e n d a t i o n within 90 d a y s after
receiving it.
1382. W h e n
is
appeal
to
the
Local
Board
of
Assessment
808
in an ex-officio
is
the
composition
of
the
809
Central
Board
of
810
811
during the year the use of that property ceases to be for said
purposes. Likewise, if at the beginning of that year, the property is
taxable because at that particular point in time, the use is for a
non-exempt purpose, not religious, educational and charitable
("REC"), the taxable status of said property continues for that
entire year even if at certain time during the year it is used for
" R E C " purposes.
Property liens shall be superior to all other liens, mortgages, or
encumbrances of any kind whatsoever and shall be enforceable
against the property whether in the possession of the delinquent or
any subsequent owner or possessor, and shall be extinguished
only by the payment of the delinquent taxes and penalties.
Illustrations:
If a real property is transferred by a non-exempt person to
an exempt person after January 1, there is still liability to pay
the tax e v e n in the hands of e x e m p t person, the tax having
accrued at the time of the transfer.
If the transfer is m a d e of an e x e m p t property after the tax
date (January 1), the property still remains e x e m p t for that
year even in the hands of a n o n - e x e m p t person. (Institucion
Teresiana vs. Board of Assessment Appeals, CTA Case No.
1110, April 1, 1963)
1390. M a y real p r o p e r t y t a x e s b e p a i d o n i n s t a l l m e n t ?
A n s w e r . At the discretion of the taxpayer, real property taxes may
be paid without penalty in four (4) equal installments.
1st on or before M a r c h 3 1 .
2 n d on or before J u n e 30
3rd on or before Sept. 30, a n d
4th o n o r before Dec. 3 1 .
3
812
for
m a y tax
advance
payments be
payment
of
real
813
c)
RPTC
LTC
NIRC
TCC
The
Code
expressly
provides that no
court
shall
entertain any suit
assailing
the
validity of a tax
assessed
until
the
taxpayer
shall have paid,
under
protest,
the tax assessed
against him.
The
Code
provides that any
tax or fee paid
pursuant
to
a
protested
ordinance
shall
be considered as
having been paid
under
protest
until
final
resolution of the
issues raised.
1396. P R O T E S T A T T H E T I M E O F P A Y M E N T I S R E Q U I R E D T O
PRESERVE
TAXPAYER'S
RIGHT
TO
CLAIM
TAX
814
loss
or destruction
of property
subject to
real
p r o p e r t y t a x e s e x t i n g u i s h t h e liability t h e r e t o ?
A n s w e r . No.
Illustration: "X" o w n s 500 s q . m. of land bordering the sea. He
has not paid the real property taxes due thereon for 4 years
before the property w a s entirely eaten by the sea. X is still liable
for the taxes that had already a c c r u e d and b e c o m e delinquent.
T h e loss of the object of taxation is not one of the ways by
w h i c h realty tax is remitted.
1400. W h a t
would
be
the
basis
of
"just
compensation"
in
815
b)
c)
d)
e)
f)
b)
c)
816
d)
Answer.
a) W h e r e , in the light of e c o n o m i c , social and other relevant
c h a n g e s , it b e c o m e s necessary to modify or adjust the
classification of real properties, their a s s e s s m e n t levels and/or
taxable v a l u e s on t h e basis of new concepts of essentiality and
m o d e m a p p r o a c h e s to real property valuations;
b)
b)
c)
d)
817
c)
d)
The ordinance fixing the rate of real property tax shall remain in
full force and effect unless a m e n d e d on or before S e p t e m b e r
15 of the year next preceding the o n e in w h i c h the a m e n d m e n t
is to take effect.
1407. Are
the
government's
imprescriptible?
remedies
in
local
taxation
b)
b.
c.
2.
The deed shall concisely recite all the proceedings upon which the
validity of the sale depends.
1 4 1 1 . W h o m a y exercise the Right of R e d e m p t i o n after sale?
The redemption period of one (1) year is counted from the date
of registration of the sale of the real property by either of the
following 1. The delinquent taxpayer;
2.
3.
local
government
avail
of criminal
action
to
remedies
of taxpayers
involving
different
prescriptive periods:
Answer.
A.
Remedies
Prescriptive Periods
Action
in
declaratory
ordinary
relief
to
court
clarify,
for
or
823
Prescriptive Period
Remedies
Administrative - Claim for refund filed
with collecting office based on solutio
indebeti
a. 30 d a y s f r o m receipt of decision
b. 15 d a y s f r o m division to En Banc
(RA 9282)
15 d a y s f r o m receipt of t h e decision
Remedies
Prescriptive Periods
824
Upon payment
payment by mistake)
Administrative - If protest is m a d e
verbally, it must be confirmed in
writing within
30 d a y s
6 years f r o m payment
Remedies
Prescriptive Periods
Administrative
Redemption
personal property under distraint
of
Before sale
Administrative - R e d e m p t i o n of real
property sold for tax delinquency
Before sale
;
Administrative - Protest by majority of
landowners
affected
by
special
municipal levy, filed with Sanggunian
Bayan within
and
appeal
Panlalawigan
of
Sanggunian Bayan
to
Sanggunian
decision
of
825
Prescriptive Periods
Remedies
Administrative
Protest
special
levies
imposed
Secretary of Finance
against
by
the
of
the
Imprescriptible
2.
3.
of
the
2.
5 0 % shall a c c r u e
property is located;
to
the
b)
5 0 % shall a c c r u e equally
barangays of the city.
barangay
to
all
where
the
component
2.
3.
all
component
DOCTRINE
defined:
EXEMPTIONS:
City of Baguio vs. Busuego, Sept.
18,
1980
of
Nueva
November, 19,
Ecija
1982
vs.
Imperial
Mining
Co.,
IMC leased from the government mineral land with the right
to explore and develop the same. The contract stipulates that
IMC shall be liable for realty tax on buildings and other
improvements but is silent on the tax on the mineral land itself.
827
City ofBacolod,
SSS,
GSIS,
CSC
or any
bureau
o f the
G o v e r n m e n t is N O T in the category of G O C C
w h i c h is taxable unless e x p r e s s l y e x e m p t in its
corporate charter.
NDC vs.
125 SCRA
752
828
PROBLEM EXERCISES
1420. T h e local g o v e r n m e n t of X province learned that several
b u s i n e s s c o m p a n i e s within the locality use pipelines to
transport petroleum products to their dealers. M a y the
local g o v e r n m e n t i m p o s e t a x e s on the gross receipts on
petroleum
companies
that
use
said
pipelines
to
transport petroleum to other localities a n d dealers?
A n s w e r . In t h e c a s e of First Phil. Industrial Corporation vs. CA,
December 29,
1998, T h e S u p r e m e Court held that pipeline
operators are in t h e truest s e n s e of the w o r d c o m m o n carriers and
are therefore e x e m p t f r o m the gross receipt tax imposed by the
local g o v e r n m e n t . T h e r e f o r e , there are two reasons w h y the local
imposition should be considered null and void, (a) Under the NIRC,
t h e right to impose tax on the gross receipts of a c o m m o n carrier
belongs to the national g o v e r n m e n t , and (b) The petroleum
c o m p a n i e s that use pipelines are c o m m o n carriers transporting
their g o o d s by land as defined under Sec. 133 of the Local
Government Code.
1421. X was
lucky
installment
for
recipient
a
of a
period
of
parcel
20
of
years
land
by
sold
the
on
local
notice
of
assessment
from
the
provincial
to
him
upon
full
payment
of the
contract
p r i c e . Is X c o r r e c t ?
A n s w e r . In the case of City of Baguio vs. Busuego, the S. C.
applied the Doctrine of Usage and held that since the property
w a s already being used by a non-exempt taxpayer, it cannot be
exempted from real property tax. The beneficial user of said
property is liable.
1422. X, a b u s i n e s s m a n by profession, leases from the
g o v e r n m e n t a parcel of land that he uses as a
w a r e h o u s e a n d parking area. T h e contract w a s for 20
y e a r s . U p o n p o s s e s s i o n of the real property he received
an
assessment
notice
from
the
City
Treasurer
d e m a n d i n g p a y m e n t of real property taxes. X protested
829
c)
d)
e)
830
not
5. T h e L B A A has 120 d a y s f r o m
receipt of the appeal to decide
5. T h e decision of the R T C is
a p p e a l e d to the C T A (division) by
w a y of a petition for review. (Rule
42, RRC)
832
7. T h e a d v e r s e decision of the
C B A A m a y be a p p e a l e d to the C T A
(En Banc) within 30 d a y s from
receipt of said decision by w a y of
petition for review. (Rule 4 3 , R R C )
7. T h e decision of the C T A - En
Banc, may be appealed before the
SC on pure question of law by w a y
of Petition for Review on Certiorari
within 15 days from receipt of the
a d v e r s e decision.
tax
on
business
enjoying
legislative
franchise?
A n s w e r . Y e s . T h e local g o v e r n m e n t may impose a local franchise
pursuant to the authority granted by the L G C that provides that,
notwithstanding any e x e m p t i o n granted by law, the province/city
m a y impose a franchise tax on all businesses enjoying a franchise.
There w a s thus an implied repeal by the L G C of PD551 insofar as
the latter imposes a 2% tax "in lieu of all taxes and assessments of
whatever
nature."
The L G C did not violate the non-impairment clause of the
Constitution, as the former w a s enacted in pursuance of the
constitutional policy to ensure autonomy to local government.
Likewise, local legislative bodies are granted direct authority by the
Constitution to levy taxes. The Constitution also reserves to
Congress the right to a m e n d , alter or repeal all franchises when the
public interest so requires. But even without such reservation
clause, franchise are subject to alterations through a reasonable
833
exercise of police power and the power to tax, both of which cannot
be contracted away. (1999 case)
1 4 3 1 . X files a c o m p l a i n t assailing the validity of the tax
o r d i n a n c e a n d p r a y i n g f o r a t a x r e f u n d o f its p e r c e i v e d
o v e r p a y m e n t s without protest. Will his claim p r o s p e r ?
Answer. Yes. X may file a complaint assailing the validity of the
ordinance and praying for tax refund of its perceived overpayments
without first filing a protest to the payment of taxes due under the
ordinance. However, failure of X to interpose the requisite appeal to
the Secretary of Justice is FATAL to his complaint for a tax refund.
(2003 case)
O
questions
appropriated
market,
the
validity
money
for
of
the
an
ordinance
construction
which
of
has
public
said
public
publication
of
market,
the
argues
ordinance
that
such
there
that
it
unfairly against t h o s e w h o w e r e
interested to
space
opportunity
but
were
not
given
the
was
no
operated
lease
to
make
locus standi t o
bring
business taxes.
X contends that
it is
not liable
835
are
government
not
real
thereby
properties"
binding
exempting
the
on
same
the
from
local
real
property taxation?
Answer. No. A n opinion c a n n o t override the power o f taxation
especially w h e n the opinion has no leg to stand o n . In several
cases, the highest court held that m o v a b l e properties installed at a
specific location with a character of p e r m a n e n c y w o u l d be
considered real properties for purposes of real property tax in
c o n s o n a n c e with the definition of real property under the Civil
Code.
1439. "X", a local electric c o m p a n y w a s a s s e s s e d real property
taxes on
its s t e e l t o w e r s ,
a n d t r a n s m i s s i o n l i n e s t h a t i t i n s t a l l e d f o r its o p e r a t i o n .
"X"
contends
that
the
said
836
properties
are
personal
taxpayer's
remedies
in
Answer.
a)
b)
lands
classified
a n d a s s e s s e d for tax
838
839
PART XV
b)
840
have to
pass
has
the
power
to
subject
public
premises
to
customs jurisdiction?
Answer. If necessary or desirable for customs purposes, the
President of the Philippines, by executive order, may declare,
subject to customs jurisdiction, any public wharf, landing place,
street or land in any port of entry that are previously under the
jurisdiction of the Bureau of Customs.
841
b)
c)
Sec. 401
(Flexibility Tariff Clause)
T h e President is e m p o w e r e d to
(a)
increase,
reduce or r e m o v e
existing protective rates of import
duty, provided that any increase in
import duty shall not e x c e e d 1 0 0 % ad
valorem, (b) to establish import quota
or to ban imports of any c o m m o d i t y ,
and (c) to impose an additional duty
on all imports not exceeding 1 0 % ad
valorem.
842
S e c . 402
(Reciprocal T r a d e a g r e e m e n t
provision)
The
President is allowed to
modify
duties
and
other
import
restrictions on products and other
items with w h i c h the Philippines had
entered into a trade a g r e e m e n t .
This section is called the reciprocal '
trade a g r e e m e n t provision authorizing
the President to enter into trade
a g r e e m e n t with foreign countries on a
reciprocal basis without need of
submitting the results of such trade
agreement
ratification.
to
the
Congress
c)
d)
843
for
No. 2. Six years ago, X bought an imported van from "Y". X used
falsified d o c u m e n t s in effecting the release of the motor vehicle
thus enabling him to pay lower import t a x e s . Acting u p o n report of
its intelligence, the c u s t o m s agents seized the car while parked at
the parking area of S M while X w a s then w a t c h i n g a movie inside
the c i n e m a . Thereafter, an a s s e s s m e n t in the a m o u n t of Php 850K
by w a y of unpaid c u s t o m s duties, surcharge and interest were
slapped on X. X w e n t to the court questioning the seizure of his car
since no warrant a p p e a r e d to have b e e n issued for the said
imported motor vehicle. That he having purchased the s a m e six
years a g o f r o m Y as e v i d e n c e d by a D e e d of Sale. He further
argues that the right of the g o v e r n m e n t to collect said taxes has
already prescribed. Rule on the validity of the seizure and X's
contention.
A n s w e r . T h e seizure is valid. T h e c u s t o m s agents have authority
over seizure and forfeiture c a s e s involving imported goods. The
regular courts do not have jurisdiction to take cognizance of cases
involving seizure of imported g o o d s . T h e r e is no need of warrant
under the given facts. In fact, t h e seizure is not unconstitutional
b e c a u s e it w a s m a d e for purposes of enforcing collection of unpaid
t a x e s . Notably, t h e collection of taxes is never unreasonable. X's
s u b m i s s i o n that the right to collect c u s t o m s duties has prescribed is
not correct b e c a u s e importation had not e n d e d . For articles subject
to c u s t o m s duties, importation ends w h e n the regular permit for
withdrawal shall have b e e n issued and the corresponding taxes
thereto fully paid. Considering that falsified d o c u m e n t s were used
importation w a s not yet e n d e d . T h u s , prescription period to collect
has not toiled.
1 4 6 1 . Doctrine of " H O T P U R S U I T " in c u s t o m s law defined:
A n s w e r . This refers to a situation w h e r e a vessel becomes subject
to seizure by reason of an act done in the Philippine waters in
violation of the tariff and customs laws, a pursuit of such vessel
began within the jurisdictional waters may continue beyond the
maritime zone, and the vessel may be seized on the high seas.
N O T E : This Doctrine is applicable to imported article that may be
subject to seizure for violation of the tariff and customs laws when
the s a m e is being transported in the Philippines by land, water or
air, and jurisdiction may be exerted over it at any place aforesaid
as may be necessary for the due enforcement of the law.
845
functions
a)
b)
Secondary
functions
846
NOTE:
O
b)
c)
d)
e)
f)
b)
1 4 6 5 . W h a t a r e t h e f i v e (5) n e w l y c r e a t e d o f f i c e s o f t h e B u r e a u
of
Customs
headed
by
the
five
(5)
Deputy
Commissioners?
Answer.
a)
b)
c)
d)
Internal Administrative G r o u p
e)
1466. W h a t
is
the
territorial
jurisdiction
of
the
Bureau
of
Customs?
A n s w e r . The Bureau of C u s t o m s has the right of supervision and
police authority over all seas within the jurisdiction of the
Philippines and over all coasts, ports, airports, harbors, bays, rivers
and inland waters w h e t h e r navigable f r o m t h e sea or not.
T h e Bureau exercises special surveillance to protect customs
revenue and prevent s m u g g l i n g . This is c o n d u c t e d over the coast,
beginning w h e n a vessel or aircraft enters Philippine territory until
the articles have passed through t h e c u s t o m h o u s e after paying the
duties or being given legal permit.
W h e n a vessel b e c o m e s subject to seizure by reason of an act
d o n e in Philippine waters in violation of the tariff and c u s t o m s laws,
a pursuit of such vessel b e g u n within the jurisdictional w a t e r s may
continue beyond the maritime z o n e , and t h e vessel m a y be seized
on the high sea. (Right of Pursuit or Extra-territorial
Jurisdiction) {llluh Asaoli vs. Commissioner, 2/28/69)
To the end of preventing s m u g g l i n g , it is the right of a custom
official to seize g o o d s that are suspected to have b e e n introduced
into the country in violation of the revenue laws not only in his o w n
district but also in any other district than his o w n .
848
does
the
customs
officials
exercise
jurisdiction
are
the
tax
cases
arising
under the
Tariff and
Customs Code?
Answer.
a) Protest cases or those w h e r e the importer questions the
legality of the a s s e s s m e n t and collection of customs duties and
other fees or charges (except the fixing of fine in seizure
cases). T h e issue involved in these cases generally relates to
the correctness of the appraisal and/or classification of
imported goods; and
b)
1 4 7 0 . I s t h e B u r e a u o f C u s t o m s s u b j e c t t o s u i t i n its o p e r a t i o n
of the arrastre service?
Answer. No. The Bureau of Customs, acting as part of t h e
machinery of the National Government in the operation of the
arrastre service, pursuant to express legislative mandate and as a
necessary incident of its prime government function, is immune
from suit, there being no statute to the contrary. (Mobil Phils.
Exploration, Inc. vs. Customs Arrastre Service, 18 SCRA 1120)
1471. W h a t are the functions of the Tariff C o m m i s s i o n ?
Answer. The Commission shall investigate:
a)
b)
c)
d)
e)
f)
g)
h)
i)
850
Philippines
and
foreign
competition
of
commodity
specifically
851
c)
2.
3.
4.
5.
6.
852
1476. May
the
legality
Commissioner
of
conditions
an
of
importation
prescribed
by
Customs
or
law
determine
ascertain
for
its
the
whether
the
importation
has
853
c)
d)
Answer.
a)
b)
c)
854
persons or articles
d)
e)
at
a)
E m e r g e n c y or forced landing.
b)
the
entry
of all
imported
articles
at the
b)
c)
d)
856
1 4 8 7 . A r e all i m p o r t e d a r t i c l e s s u b j e c t t o c u s t o m s d u t y ?
A n s w e r . All imported articles, w h e n imported from any foreign
country into the Philippines, are subject to duty upon each
importation, e v e n t h o u g h previously exported f r o m the Philippines,
e x c e p t as otherwise provided in the Tariff and C u s t o m s C o d e or in
other laws.
1488. W h a t articles are under the jurisdiction of the T C C :
Answer.
a) All articles subject to duty, or
b)
c)
d)
857
1489. Distinguish
absolutely
free
conditionally free importation:
Answer.
Absolutely Free Importation
Articles exempt from duty without
any condition.
importation
from
in case of
o f prohibited
importation
a)
b)
c)
d)
e)
f)
human
and
or
weapons,
conception
or
g)
h)
i)
j)
k)
or other
money
charges.
However,
under Sec.
2 4 0 2 o f t h e T C C , w h i c h w a s e n a c t e d t h r e e (3) y e a r s a f t e r
RA 1125, it expressly confers upon the C T A jurisdiction
over appeals in seizure cases. Thus, there seems to be
no doubt as to the jurisdiction of said appellate court
over such cases.
1492. W h a t
is
the
extent
of
the
phrase
"merchandise
of
b)
c)
d)
e)
f)
g)
h)
i)
j)
k)
I)
Articles brought into the country for p r o c e s s i n g , but to be ree x p o r t e d ; (e.g. Export Processing Z o n e )
profession
or
o)
Bibles,
missals,
prayer
books,
860
Koran,
ahadith
and
other
extracts
therefrom,
W h e n t h e container is leaking or d a m a g e d .
c)
d)
e)
f)
1495. T w o
Customs Code?
Answer.
a) Tentative liquidation - It is subject to future and final
readjustment and settlement within a period of six (6) months
from date of tentative liquidation.
b)
861
b)
c)
d)
1498. To w h o m
TCC?
is "Person"
Answer.
a) An individual, or
b) A corporation or c o m p a n y , or
c) A partnership, or
d) An association or any other kind of organization.
1499. May the imported goods be allowed delivery to another
person upon order of the importer?
Answer. Yes. T h e importer o n record m a y authorize delivery to
another person by writing u p o n the f a c e of the w a r e h o u s e
withdrawal entry his orders to that effect.
The delivery of the article to another person does not relieve
the importer and his c a s h deposit, irrevocable domestic letter of
862
3.
4.
2.
upon prior
Commission
5.
under
865
on
all
imports
not
1504. Distinctions
importation:
Answer.
Dumping Duty
Imposed upon
foreign
goods
with
value
lower than their
F M V to t h e
detriment
of
local products
Nature
Amount
or
Rate
Imposing
authority
Difference
between
the
actual
price
and the normal
value
of
the
article
Special
Committee
on
Anti-Dumping
( C o m p o s e d of
the Sec. of
Finance
as
Chairman;
M e m b e r s : Sec.
of Department
of
Trade
&
industry
and
either the Sec.
of Agriculture if
article
in
question is agri.
products or the
Sec. of Labor if
non-agri.
1505. Briefly d i s c u s s
taxes/duties:
among the
different special
Countervailing
Duty
Imposed
upon
foreign
goods
enjoying subsidy
thus
allowing
t h e m to sell at
lower prices to
the detriment of
local
products
similarly situated
Marking Duty
Imposed upon
those
not
properly
marked as to
place of origin
of the goods
Equivalent to the
bounty, subsidy
or subvention
5%
valorem
articles
Secretary
Finance
Commissioner
of C u s t o m s
the
of
procedures
in
the
ad
of
levies
Discriminatory^
Duty
Imposed
uporT
goods
coming
from
countries
that discriminate
against
Philippine
Products.
A n y amount noT
exceeding 100%
as valorem of
the
subject
articles
President of the
Philippines
imposition
Answer.
a) Declaration by the importer of the importation, m a d e in:
866
on
of
A s s e s s m e n t o f taxes
867
2.
3.
d)
e)
869
Arrastre
charge
defined:
dues
defined:
1 5 0 9 . D r a w b a c k d e f i n e d - It is a d e v i c e w h e r e b y g o o d s affected by
taxes are re-exported as if they are not taxed at all.
It refers to duties or taxes paid back or remitted by the
G o v e r n m e n t on the exportation of that on w h i c h they w e r e levied.
Under the T C C , d r a w b a c k s also refer to refund of duties on
imported fuel used for p r o p u l s i o n of v e s s e l s .
1510. Prescription under the T C C :
A n s w e r . T h e T C C does not e x p r e s s any general statute of
limitation, it provided, however, that " w h e n articles have entered
and passed free of duty or final adjustment of duties m a d e with
subsequent delivery, such entry and p a s s a g e free of duty or
settlement of duties will after the expiration of o n e (1) year, from
the date of final payment of duties, in the a b s e n t of fraud or protest,
be final and conclusive u p o n all parties. This limitation does not
apply to liquidations that are tentative.
870
are
the
penalties
in
case
of
violation
of
the
provisions of the T C C ?
Answer.
a) If g o o d s have b e e n forfeited for violation of the Tariff and
C u s t o m s C o d e , t h e importer thereof m a y still be held criminally
liable;
b)
c)
d)
1513. W h e n is s m u g g l i n g c o m m i t t e d ?
Answer. It is committed w h e n a person (a) fraudulently imports or
brings into the Philippines or assists in transporting or bringing into
the Philippines any article contrary to law, or (b) receives, conceals,
buys, sells or in any m a n n e r facilitates the transportation,
concealment or sale of such articles after importation knowing the
s a m e to have been imported contrary to law. (Rodriguez vs. CA)
1514. Foreign Port defined:
A n s w e r . A port or place outside the jurisdiction of the Philippines.
1515. Principal Port of Entry defined:
A n s w e r . W h i c h is the chief a n d p e r m a n e n t port of entry of the
collection district wherein it is situated and is the p e r m a n e n t station
of the Collector of such port.
Sub-port of Entry - It is a port under the administrative jurisdiction
of the Collector of the Principal Port of Entry of t h e District.
872
1516.
point
of imported
articles:
2.
Z>
1 5 1 9 . D i s t i n c t i o n s b e t w e e n a c a r g o m a n i f e s t a n d bill o f l a d i n g :
Answer.
C a r g o Manifest
It is a declaration of the entire cargo
The object of a manifest is to
facilitate the labors of the customs
authorities and to prevent the
unlawful entry of goods into the
country.
O
Bill of L a d i n g
It is a declaration of a specific part of
the cargo
This is prepared as a matter of
business
convenience
based
exclusively
on
a
contract
and
d e s i g n e d to protect the importer or
consignee.
2.
874
to
make
import
entry
under
the
Answer.
a) T h e importer as a holder of the bill of lading.
b)
c)
1522. What
is
the
rule
regarding
description
of articles
in
import entry?
A n s w e r . All imported articles must be described in sufficient detail
to enable t h e m to be identified both for tariff classification and
statistical purposes.
1523. W h a t is the m e a n i n g of "entry" in the Tariff C o d e ?
Answer. It has a triple meaning a)
b)
c)
875
Informal Entry
It is used to clear from customs
custody b a g g a g e a c c o m p a n i e d by
p a s s e n g e r s , s h i p m e n t s of parcels
through the mails and through the
international airport with a dutiable
value of Php 2K or less, a n d it is filled
out by the c u s t o m s e x a m i n e r himself
for the o w n e r or a d d r e s s e e of the
parcel.
876
c)
877
in foreign trade
878
1536. W h a t is t h e rule on
board any vessel?
overstaying
imported
articles
on
duty of the
master of vessel
in
case
of
of
879
d)
Home
Consumption
Value
as
basis
of
are
the
examination,
duties
of
the
classification
customs
and
officer
appraisal
of
in
the
imported
articles?
Answer.
a) He shall determine that the packages designated for
examination and their contents are in accordance with the
declaration in the entry, invoice and pertinent documents.
b)
c)
881
2.
3.
b)
c)
882
a)
b)
c)
b)
c)
d)
delivery
of u n e x a m i n e d
package,
the
a)
b)
885
c)
does the
Bureau
of Customs
normally exercise
886
887
2.
3.
Un-manifested c a r g o e s ;
4.
5.
888
b)
c)
889
d)
e)
f)
g)
TCC?
Answer. Issuance of the W a r r a n t of Seizure and Detention must
be based upon probable c a u s e that the articles in question were
imported or attempted to be exported contrary to the Tariff and
Customs Law.
1563. Proof required in seizure
goods under the T C C :
Answer.
there is
enough.
evidence
and
forfeiture
of
imported
is
the
duty
of
the
Collector
of
Customs
upon
b)
c)
d)
T h e release under c a s h b o n d
Commissioner of Customs.
by the
Consignee
A n y person holding the bill of lading
b)
By publication in a newspaper.
c)
If after fifteen (15) days the unknown owner fails to appear after
notification of seizure the Collector shall declare the property
forfeited to the government to be sold at auction in accordance with
law.
1569. H o w is seizure case in c u s t o m s law settled?
Answer.
a) By payment of fine, or
b) By redemption of forfeited property.
1570. W h a t are the requisites for the settlement of seizure case
through the payment of fine:
Answer.
a) T h e seizure case is
Collector of C u s t o m s .
still
pending
b)
c)
d)
e)
f)
approval
of the
892
is
the
extent
of
the
jurisdiction
of
the
C o m m i s s i o n e r of C u s t o m s in forfeiture proceedings?
A n s w e r . T h e C o m m i s s i o n e r of C u s t o m s w h e n sitting in forfeiture
proceedings constitutes a tribunal u p o n w h i c h the law confers
jurisdiction to d e t e r m i n e all questions touching the forfeiture and
further disposition of t h e illegally imported merchandise. (Auyong
Hian vs. CTA, 59 SCRA 110)
1573. W h o has the b u r d e n of proof in seizure and/or forfeiture
cases?
Answer.
a) In all proceedings t a k e n for the seizure and/or forfeiture of any
vehicle, v e s s e l , aircraft, beast or articles under the provisions
of the tariff and c u s t o m s laws, the burden of proof lies upon the
claimant;
b)
893
Commissioner vs.
Castro - dutiable g o o d s of commercial
quantity m a d e to pass under the cover of p a s s e n g e r s ' baggage
or otherwise u n m a n i f e s t e d ; unless there be unmistakable proof
of honest mistake.
b)
Leuterio
vs.
undervalued.
c)
Commissioner
894
imported
articles
that
are
1577. Rule
on
forfeiture
importation:
of
vessels
used
in
unlawful
c)
W h e r e the release of
(Transglobe Int'l. Inc. vs.
25, 1999)
895
b)
Unauthorized
warehouses;
c)
d)
e)
withdrawal
of
imported
articles
from
bonded
896
b)
B r e a c h of b o n d ;
c)
d)
e)
b)
c)
d)
e)
f)
g)
i)
j)
k)
I)
2.
3.
898
5.
the
Collector
of Customs
exercise
the
power
of
and
judicial
Protest
Ground - legality or correctness of the assessment of the
duties.
899
It must be in writing;
b.
c.
d.
Scope of protest in Customs Law The protest must be limited to the subject matter of a
single adjustment or other independent transaction, but
any number of issues may be raised in a protest with
reference to the particular item(s) constituting the subject
matter of the protest.
Single adjustment - refers to the entire content of one
liquidation, including all duties, f e e s , and surcharges or
fines incident thereto.
Procedure - If the t a x p a y e r disagrees with the assessment
made by the collector, he must nevertheless pay the tax,
and then protest the a s s e s s m e n t within 15 days from
payment. T h e protest must be in writing, setting forth all the
objections to the ruling or decision in question together with
the reasons relied u p o n , or else the s a m e shall be deemed
waived.
O
900
the
901
correct,
but w e r e
re-
902
It m u s t be in writing;
b)
c)
d)
H o w effected?
a)
b)
c)
903
1 5 8 7 . R e m e d y o f d e l i n q u e n t i m p o r t e d t o p r e v e n t t h e s a l e o f his
unpaid and undelivered shipment:
Answer. T h e delinquent importer m a y prior t o the sale of the
imported article, settle his obligations with t h e B u r e a u of Customs,
in which c a s e the aforesaid articles m a y be delivered u p o n proper
payment of duties, taxes and other c h a r g e s and c o m p l i a n c e with
the requirements of law.
1588. NO Injunction Rule defined:
Answer. No court can interfere in the exercise o f the exclusive
jurisdiction of the B u r e a u of C u s t o m s to enforce t h e tax liabilities
under the T C C .
The only court that c a n grant injunctions against the
Commissioner is the C T A (by special provision of law), but it can
only do so if the c a s e is within its jurisdiction. T h u s , unless the tax
is first paid, protested and d e c i d e d , a n d t h e n a p p e a l e d to the
Commissioner, the C T A cannot issue an injunction.
904
a)
b)
c)
905
T h o s e involving a n t i - d u m p i n g duties a n d
during;
anti-countervailing
b)
T h a t a d e c i s i o n is a d v e r s e to the g o v e r n m e n t is r e c k o n e d
f r o m the original a s s e s s m e n t .
Illustration:
T h e examiner a s s e s s e s the tax at P h p 50,000.00. Importer
pays and protests, claiming the tax is only Php 10,000.00. After
906
are
Answer.
a) T h o s e involving liability for c u s t o m s duties, fees or other money
charges;
b)
T h o s e involving
affected;
seizure,
detention,
or release of property
c)
d)
907
ON
TARIFF
and
CUSTOMS
LAW
IN
908
2.
The
absence
importations.
of
cargo
manifest
for
the
subject
T h e Tariff a n d C u s t o m s C o d e
imported articles, ad v a l o r e m .
3.
1598.
910
THE
EFFECTIVE
TAX
U n d e r the T C C , BC & T C :
publicity
a) Educational c a m p a i g n ,
and tax counseling
publicity
b) O b s e r v a n c e of t h e c a n n o n s of a
sound tax s y s t e m .
b) O b s e r v a n c e of the canons of a
s o u n d tax s y s t e m .
c)
Information
gathering
preparation of tax registers.
and
d) Registration of business
with the DTI a n d with BIR.
name
d)
Registration
of vessels
and
aircraft in coastwise and foreign
trade.
e)
Required
issuance
of sales
invoices and receipts a n d keeping of
accounting books.
e)
Required
commercial
and
consular invoices or certification by
Philippine consular officials.
h) Exhibition of certificate of p a y m e n t
of taxes at places of business, signs
to be exhibited by business e n g a g e d
in liquor or tobacco production or
sale
//.
METHODS
TCC
NIRC
UNDER
c) Making
investigation,
issuing
summons and taking testimony
c)
Making
investigation,
issuing
s u m m o n s and taking testimony
d)
Rewards
to
assistance
detection of smuggling.
b) Conducting
business.
///.
surveillance
of
WHAT
ARE
THE
DIFFERENT
SAFEGUARDS
TO
INSURE
TAX
NIRC AND TCC?
PERSUASIVE
COLLECTION
MEANS
UNDER
in
AND
THE
NIRC
TCC
a) Requiring deposits of b o n d s to
assure collection, or re-exportation of
goods.
d)
Declaration,
statements
and
returns to be m a d e under penalties
of perjury.
912
"Administrative
Tax L a w s " .
Agencies
enforcing
Police A g e n c i e s .
f) Storage in b o n d e d w a r e h o u s e s of
goods subject to specific tax.
f) Storage
warehouses.
h)
Ordering
termination
accounting period.
in
customs
bonded
of
1 5 9 9 . W H A T A R E T H E D I F F E R E N T C O E R C I V E (Extrajudicial) M E A N S
IN THE COLLECTION OF DELINQUENT TAXES:
NIRC
TCC
b) No levy.
b) Levy
91 3
e ) C o m p r o m i s e (needs approval of
Secretary, and does not include
criminal cases), and settlement.
1600. COMPARATIVE
REMEDIES AVAILABLE
UNDER THE NIRC AND T H E TCC:
NIRC
TAXPAYERS
TCC
A) Administrative remedies
1. Before payment of the tax:
a)
TO
b) Entering into a c o m p r o m i s e
with the BIR (Sec. 204)
2. After payment of the tax:
914
A) Administrative remedies
1. Protest
a), any importer or interested
party adversely affected with
the published value of duties
m a y within 15 days from
date of publication file a
written protest.
b) If legality of assessment
or appraisal is questioned,
t a x p a y e r may protest within
15 d a y s from assessment.
* P a y m e n t under protest is
necessary.
1. Civil Action -
a) A p p e a l to the C T A within 30
d a y s f r o m receipt of t h e
a d v e r s e decision of the C I R
or f r o m lapse of 180 d a y s
inaction of t h e C I R on the
dispute. (Sec. 2 2 8 )
b) Action to contest forfeiture
of chattel. (Sec. 231)
for d a m a g e s
Refund
- Abatement
or
drawback
(if
importation
missing or deficient or if reexported).
(Sees.
17011708, T C C )
B) Judicial remedies:
B) Judicial r e m e d i e s :
1. Civil A c t i o n :
c) Action
227)
2.
(sec.
d)
Injunction - W h e n the
collection of the tax m a y
jeopardize
interest
of
taxpayer or the government,
CTA
may
enjoin
the
collection and may require
the taxpayer to put in a
b o n d . (Sec. 1, RA 1125)
2. Criminal Action:
Acting erring and abusive
tax
officials
and/or
employees of the BIR.
915
a) A p p e a l to C T A within 30
d a y s from received of the
adverse
decision
of the
C o m m i s s i o n e r of Secretary
of Finance.
*
A d v e r s e decision of the
Collector is appealable to
t h e Commissioner not to the
C T A within 15 days from
receipt thereof (notice to the
collector of appeal to the
C o m m i s s i o n e r is required)
(Sec. 2313. T C C )
b)
Action to question
legality of the seizure.
the
c) A b a n d o n m e n t of the goods.
(Sec. 1802, TCC)
N O T E : The taxpayer's judicial relief both under the NIRC and the
TCC may lie either with the CTA (exclusive in all cases
cognizable by it) or the ordinary courts (in all other cases).
PROBLEM EXERCISES
1601.
1602. X,
dual
country
citizen
after the
opted
to
approval
permanently
of his
dual
reside
in
the
citizenship.
He
the
corresponding
decided
to
instead
bringing
relocate
effects.
Six
duties.
his
family
along
with
After
to
Bangkok,
them
months thereafter,
his
sometime
all
their
eldest son
he
Thailand
personal
(S)
got
together with
other various
appliances
so
of the
same
2-door
refrigerator subject to
duty?
A n s w e r . Y e s , b e c a u s e the T C C provides that "all articles, when
imported from any foreign country shall be subject to duty upon
e a c h importation, even t h o u g h previously exported, except as
otherwise specifically provided in the C o d e or in other laws.
1603. Can
the
customs
authorities
subject
persons
coming
917
duty,
bringing
with
him
BMW
motor
vehicle
Philippine
special
or
Government
diplomatic
officials
missions
who
abroad
returned
from
exempt
from
baggage examinations?
Answer. All Philippine G o v e r n m e n t officials leaving for, or returning
f r o m , official or unofficial missions a b r o a d are subject to baggage
inspection by the Bureau of C u s t o m s personnel. This is intended to
curb s m u g g l i n g .
918
by such
diplomats
by
from
seizing,
detaining,
transporting
and
919
Mison
vs.
Natividad.
Collector.
classification
Under Sec.
or return
1407
is the responsibility of
of the T C C ,
approved
by
him
appraisal,
may
not be
agricultural
warehouse. X has
imported
products
the
customs
920
requisites
for forfeiture
of goods
under
S e c . 2 5 3 0 (f), i n r e l a t i o n t o ( 1 ) ( 3 - 5 ) , o f t h e T C C ?
Answer.
a)
922
on the
importation
or exportation
of
b)
c)
923
Regional Trial
Court.
that the
customs
agents
imported
goods
belonging
The
are
924
to
in
X.
any
of some
seizure
imported
abroad
officials,
and
he
cellphones
through
was
commercial
connivance
able
in
to
with
cause
payments
the
and
quantities
some
release
from
customs
of
the
clearances. The
cellphones
are
Bureau of Customs
raided Y's
h o u s e a n d s e i z e d all t h e c e l l p h o n e s . I s t h e s e a r c h a n d
seizure valid? Reason.
A n s w e r . While t h e general rule provides that a search warrant is
not necessary to effect the search and seizure of dutiable goods
concealed for purposes of tax evasion, the customs officials cannot
enter a dwelling without a valid warrant. T h e search and seizure of
the c u s t o m s agents without the benefit of a search warrant issued
by the court is not valid and is unconstitutional. The customs
officials are allowed to enter offices, w a r e h o u s e or business
establishments without warrant for enforce customs laws but not
dwelling.
1623. M a y the Collector of C u s t o m s issue
a n d detention of a C e s s a plane
persons and gas lamps for the sole
a n d g u i d i n g t h e plane's t a k e off f r o m
smuggling?
a warrant of seizure
used to transport
p u r p o s e of lighting
the airstrip in aid of
the cargo plane to take off without peril and transport the goods to
its final destination. Such complementary or collateral use of the
plane for smuggling operation is sufficient for it to be deemed to
have been used unlawfully in the smuggling of undeclared goods.
1624. W h a t is the basis of dutiable value of an i m p o r t e d article
subject to an ad valorem tax under the T C C ?
Answer. Under RA 9135, the basis now is the transactional value
which shall be the price actually paid or payable for the goods
when sold for export to the Philippines, adjusted by adding certain
cost elements to the extent that they are incurred by the buyer but
are not included in the price actually paid or payable for the subject
imported goods. If such value could not be d e t e r m i n e d , the (a)
transactional values of identical goods, (b) of similar goods; (c)
deductive value; (d) computed value and (e) fallback value may be
used to ascertain the import taxes d u e .
1625. Is
the
power
of
supervision
and
control
over
the
foreign
mails
arriving
in
the
country
within
the
Commissioner
of
Customs
issued
rules
and
i m p o r t e r b e l i e v e s t h a t m o r e a v e n u e s for
corruption
results
926
because
more
p e o p l e are
goods
arrived
from
customs warehouse.
Japan
Before
and
its
were
stored
in
the
release X w e n t to the
noticed some
damage.
It
was
boxes opened
later
and the
established
that
others
the
badly
loss
and
its v o y a g e . I s X e x e m p t f r o m
kind
of
properties
in
customs
custody
can
c)
d)
be
X,
an
English
national
decided
to
marry
her Filipina
of
duties
considering
that
he
decides
to
the
government
liable
for
customs
duties
on
importation of articles?
Answer. Yes, all g o v e r n m e n t importations for its o w n use or its
subordinates, branches, instrumentalities, or corporations shall be
subject to duty, tax, f e e s and other c h a r g e s except those
importations provided for in Sec. 105 of the Tariff a n d Customs
Code. (Sec. 1205)
928
929
of
duties
and
taxes
due
the
used
in the
Bureau
of
Customs?
Answer. Y e s .
1642. W h a t are the other types of fees that m a y be imposed by
the Bureau of customs aside from duties?
Answer.
a) Arrastre charges
b)
c)
Berthing fees
d)
T o n n a g e fees, and
e)
Harbor fees.
930
is
from
the
owner
the
of trucks
Bureau
of
transporting
Customs
to
container vans
the
taxpayers'
of
the
down
items
and
delay in
were
spoiled
beyond
human
customs
931
c)
d)