MANILA INTERNATIONAL AIRPORT AUTHORITY v.

Court of Appeals
Facts:
Petitioner Manila International Airport Authority (MIAA) operates the Ninoy
Aquino International Airport (NAIA)
As operator of the international airport, MIAA administers the land,
improvements and equipment within the NAIA Complex. The MIAA Charter
transferred to MIAA approximately 600 hectares of land,... The MIAA Charter
further provides that no portion of the land transferred to MIAA shall be
disposed of through sale or any other mode unless specifically approved by
the President of the Philippines.
The OGCC opined that the Local Government Code of 1991 withdrew the
exemption from real estate tax granted to MIAA under Section 21 of the MIAA
Charter. Thus, MIAA negotiated with... respondent City of Parañaque to pay
the real estate tax imposed by the City. MIAA then paid some of the real estate
tax already due.
MIAA received Final Notices of Real Estate Tax Delinquency from the City of
Parañaque.
The Mayor of the City of Parañaque threatened to sell at public auction the
Airport Lands and Buildings should MIAA fail to pay the... real estate tax
delinquency.
MIAA filed with the Court of Appeals an original petition for prohibition and
injunction
The petition sought to restrain the City of Parañaque from imposing real estate
tax on, levying... against, and auctioning for public sale the Airport Lands and
Buildings.
Court of Appeals dismissed the petition because MIAA filed it beyond the 60-
day reglementary period.
Court of Appeals also denied... motion for reconsideration... the present
petition for review.
MIAA insists that it is... exempt from real estate tax under Section 234 of the
Local Government Code because the Airport Lands and Buildings are owned
by... the Republic.
To justify the exemption, MIAA invokes the principle that the government
cannot tax itself.
Respondents invoke Section 193 of the Local Government Code, which
expressly withdrew the tax exemption privileges of "government-owned and-
controlled corporations" upon the effectivity of the Local Government Code.
Issues:
whether the Airport Lands and Buildings of MIAA are exempt from real estate
tax under existing laws.
Ruling:
We rule that MIAA's Airport Lands and Buildings are exempt from real estate
tax imposed by local governments.
First, MIAA is not a government-owned or controlled corporation but an
instrumentality of the National Government and thus exempt from local
taxation. Second, the real properties of MIAA are owned by the Republic of
the Philippines and thus... exempt from real estate tax.
There is no dispute that a government-owned or controlled corporation is not
exempt from real estate tax. However, MIAA is not a government-owned or
controlled corporation.
Since MIAA is neither a stock nor a non-stock corporation, MIAA does not
qualify as a government-owned or controlled corporation.
MIAA is a government instrumentality vested with corporate powers to
perform efficiently its governmental functions. MIAA is like any other
government instrumentality, the only difference is that MIAA is vested with
corporate powers.
When the law vests in a government instrumentality corporate powers, the
instrumentality does not become a corporation. Unless the government
instrumentality is organized as a stock or non-stock corporation, it remains a
government instrumentality exercising not only... governmental but also
corporate powers. Thus, MIAA exercises the governmental powers of eminent
domain,... police authority... and the levying of fees and charges.
At the same time, MIAA exercises "all the... powers of a corporation under the
Corporation Law, insofar as these powers are not inconsistent with the
provisions of this Executive Order."
When local governments invoke the power to tax on national government
instrumentalities, such power is construed strictly against local governments.
The rule is that a tax is never presumed and there must be clear language in
the law imposing the tax. Any doubt whether a person,... article or activity is
taxable is resolved against taxation. This rule applies with greater force when
local governments seek to tax national government instrumentalities.
Another rule is that a tax exemption is strictly construed against the taxpayer
claiming the exemption. However, when Congress grants an exemption to a
national government instrumentality from local taxation, such exemption is
construed liberally in favor of the national... government instrumentality.
There must be express language in the law empowering local governments to
tax national government instrumentalities. Any doubt whether such power
exists is resolved against local... governments.