PHILIPPINE BASKETBALL ASSOCIATION vs CA

FACTS: On July 21, 1989, the petitioner received an assessment from the CIR for the
paymentof deficiency amusement tax in the amount of P5, 864,260.84 (including 75%surcharge and
25% interest for 2 years). The petitioner contested the assessment but it was denied by the CIR. The
Court of Tax Appeals also dismissed the subsequent petition of PBA. The Court of Appeals affirmed the
ruling of the CTA so the petitioner filed this petition for certiorari. Petitioner’s arguments: Jurisdiction
to collect amusement taxes of PBA is vested with the local government and not the national
government. It argues that they should be included in the enumeration provided by Section 13 of the
Local Tax Code of 1973. Commissioner’s issuance of BIR Ruling No. 231-86 and BIR Revenue
Memorandum Circular No. 8-88 -- both upholding the authority of the local government to collect
amusement taxes -- should bind the government or that, if there is any revocation or modification of
said rule, the same should operate prospectively. Income from the cession of streamer and advertising
spaces to VEI should not be subject to amusement taxes In case they are made liable to pay the
deficiency amusement tax, they should not be charged with the 75% surcharge.

ISSUES:
1. WON the amusement tax on admission tickets to PBA games a local tax –NO
2. WON BIR Ruling No. 231-86 and BIR RMC No. 8-88 binds the government – NO
3. WON income from the cession of streamer and advertising spaces to VEI is subject to amusement
taxes – YES
4. WON the petitioner should be charged with amusement tax – YES

HELD: 1.Sec 13 of the Local Tax Code indicates that the province can only impose a
taxon admission from the proprietors, lessees, or operators of theaters, cinematographs, concert halls,
circuses and other places of amusement. The authority to tax professional basketball games is not
therein included, **YOU MAY NOT INCLUDE THIS** as the same is expressly embraced in PD 1959,
which amended PD 1456, wherein it is clear that the "proprietor, lessee or operator of. . . professional
basketball games" is required to pay an amusement tax equivalent to fifteen per centum (15%) of their
gross receipts to the Bureau of Internal Revenue, which payment isa national tax. While Section 13 of
the Local Tax Code mentions "other places of amusement", professional basketball games are definitely
not within its scope. Under the principle of ejusdem generis. In determining the meaning of the phrase
"other places of amusement", one must refer to the prior enumeration of theaters, cinematographs,
concert halls and circuses with artistic expression as their common characteristic.

Professional basketball games do not fall under the same category as theaters, cinematographs,
concert halls and circuses as the latter basically belong to artistic forms of entertainment while
the former caters to sports and gaming. Also, a historical analysis of pertinent laws does reveal the
legislative intent to place professional basketball games within the ambit of a national tax. Previous laws
(PD 871 by PD 1456 and PD 1959) shows are cognition that the amusement tax on professional
basketball games is a national, and not a local, tax.)

2. Commissioner’s issuance of BIR Ruling No. 231-86 and BIR Memorandum Circular No. 8-88, both
upholding the authority of the local government to collect amusement taxes cannot bind the
government. The government cannot be never be in estoppels, particularly in matters involving tax. It
is a well-known rule that erroneous application and enforcement of the law by public officers do not
preclude subsequent correct application of the statute, and that the Government is never estopped by
mistake or error on the part of its agents.

3. PD 1456 provides that for the purpose of the amusement tax, the term gross receipts’ embraces all
the receipts of the proprietor, lessee or operator of the amusement place. That definition of gross
receipts is broad enough to embrace the cession of advertising and streamer spaces as the same
embraces all the receipts of the proprietor, lessee or operator of the amusement place.

4. The issue on the payment of surcharge was never posed as an issue before the respondent court so
it must necessarily fail

SMART COMMUNICATIOSN VS MUNICIPALITY OF MALVAR

FACTS: Smart constructed a telecommunications tower within the territorial jurisdiction of the
Municipality. The construction of the tower was for the purpose of receiving and transmitting cellular
communications within the covered area. Municipality passed Ordinance No. 18, series of 2003, entitled
"An Ordinance Regulating the Establishment of Special Projects." Thereafter, Smart received from the
Permit and Licensing Division of the Office of the Mayor of the Municipality an assessment letter with a
schedule of payment for the smart telecom towers which they failed to pay Municipality caused the
posting of a closure notice to the towers. Smart protested, claims: lack of due process. And challenge
ordinance no.18. RTC held: partly grant smarts appeal/petition. the trial court declared valid the
assessment starting 1 October 2003, citing Article 4 of the Civil Code of the Philippines, in relation to
the provisions of Ordinance No. 18 and Section 166 of Republic Act No. 7160 or the Local Government
Code of 1991 (LGC). Smart petition for review, Court of Tax Appeals HELD: denied MR, CTA en
bank: denied second MR. Ground lack of jurisdiction where the constitutionality of a law or rule is
challenge. hence this petition.

ISSUE: w/n CTA en banc decisions erred and should have exercised its jurisdiction and declared the
ordinance illegal. And respondent has no authority to impose the so called fees on the basis of the void
ordinance

Held: **may not include this** (Section 5, Article X of the 1987 Constitution provides that “[e]ach
local government unit shall have the power to create its own sources of revenues and to levy taxes,
fees, and charges subject to such guidelines and limitations as the Congress may provide, consistent
with the basic policy of local autonomy. Such taxes, fees, and charges shall accrue exclusively to the
local government.” Consistent with this constitutional mandate, the Local Government Code (LGC)
grants the taxing powers to each local government unit. Specifically, Section 142 of the LGC grants
municipalities the power to levy taxes, fees, and charges not otherwise levied by provinces. Section
143 of the LGC provides for the scale of taxes on business that may be imposed by municipalities while
Section 147 of the same law provides for the fees and charges that may be imposed by municipalities
on business and occupation. The LGC defines the term “charges” as referring to pecuniary liability, as
rents or fees against persons or property, while the term “fee” means “a charge fixed by law or ordinance
for the regulation or inspection of a business or activity.”)

In this case, the Municipality issued Ordinance No. 18, which is entitled “An Ordinance Regulating
the Establishment of Special Projects,” to regulate the “placing, stringing, attaching, installing, repair
and construction of all gas mains, electric, telegraph and telephone wires, conduits, meters and other
apparatus, and provide for the correction, condemnation or removal of the same when found to be
dangerous, defective or otherwise hazardous to the welfare of the inhabitant[s].” It was also envisioned
to address the foreseen “environmental depredation” to be brought about by these “special projects” to
the Municipality. Pursuant to these objectives, the Municipality imposed fees on various structures,
which included telecommunications towers. As clearly stated in its whereas clauses, the primary
purpose of Ordinance No. 18 is to regulate the “placing, stringing, attaching, installing, repair
and construction of all gas mains, electric, telegraph and telephone wires, conduits, meters and
other apparatus” listed therein, which included petitioner’s telecommunications tower. Clearly, the
purpose of the assailed Ordinance is to regulate the enumerated activities particularly related to the
construction and maintenance of various structures. The fees in Ordinance No. 18 are not
impositions on the building or structure itself; rather, they are impositions on the activity subject
of government regulation, such as the installation and construction of the structures. Since the
main purpose of Ordinance No. 18 is to regulate certain construction activities of the identified special
projects, which included “cell sites” or telecommunications towers, the fees imposed in Ordinance No.
18 are primarily regulatory in nature, and not primarily revenue–raising. While the fees may
contribute to the revenues of the Municipality, this effect is merely incidental. Thus, the fees imposed
in Ordinance No. 18 are not taxes. Considering that the fees in Ordinance No. 18 are not in the nature
of local taxes, and petitioner is questioning the constitutionality of the same, the CTA correctly dismissed
the petition for lack of jurisdiction.