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This case involved two provisions in Administrative Order 372 issued by President Ramos during an economic crisis. Section 1 directed local governments to reduce expenditures by 25% while Section 4 withheld 10% of local governments' internal revenue allotments. The Supreme Court ruled that Section 1 was a valid exercise of presidential supervision as it was advisory in nature. However, Section 4 was invalid as the withholding of funds contravened the Constitution and laws granting automatic release of revenue to local governments.
This case involved two provisions in Administrative Order 372 issued by President Ramos during an economic crisis. Section 1 directed local governments to reduce expenditures by 25% while Se…