Mactan Cebu International Airport Authority v. Hon. Ferdinand J. Marcos

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Mactan Cebu International Airport Authority v. Hon. Ferdinand J. Marcos, G.R. No. one two zero zero eight two, eleven September nineteen ninety-six

FACTS: Petitioner: Mactan Cebu International Airport Authority

The Mactan-Cebu International Airport Authority was created under Republic Act Number sixty-nine five eight to principally undertake the economical, efficient, and effective control, management, and supervision of the Mactan International Airport, the Lahug Airport in Cebu City, and other airports that may be established in Cebu. Its charter mandates it to promote international and domestic air traffic, enhance regional trade and tourism, and upgrade airport facilities to internationally acceptable standards. Under Section fourteen of Republic Act Number sixty-nine five eight, Mactan-Cebu International Airport Authority was expressly granted exemption from real property taxes imposed by the national government or its political subdivisions.

On October eleventh, nineteen ninety-four, the City Treasurer of Cebu demanded payment of two million two hundred twenty-nine thousand seventy-eight pesos and seventy-nine centavos in real property taxes covering several parcels of land owned by Mactan-Cebu International Airport Authority in Lahug, Cebu City. Mactan-Cebu International Airport Authority objected, asserting that it was exempt from real property taxes pursuant to Section fourteen of its charter and further claiming that it is an instrumentality of the national government performing governmental functions. Mactan-Cebu International Airport Authority relied on Section one hundred thirty-three (o) of the Local Government Code, which prohibits local government units from taxing the national government, its agencies, and instrumentalities.

The City of Cebu, however, refused to cancel the tax assessment, arguing that Mactan-Cebu International Airport Authority is a government-owned or controlled corporation performing proprietary functions. As such, its tax exemptions were allegedly withdrawn by Sections one hundred ninety-three and two hundred thirty-four of the Local Government Code, which took effect on January first, nineteen ninety-two, and which expressly revoked tax exemptions previously enjoyed by government-owned or controlled corporations unless otherwise provided in the Code.

To prevent the issuance of a warrant of levy, Mactan-Cebu International Airport Authority paid the assessed taxes under protest and subsequently filed a Petition for Declaratory Relief before the Regional Trial Court of Cebu, docketed as Civil Case Number CEB-one six nine zero zero. Mactan-Cebu International Airport Authority maintained that despite being a government-owned corporation, it should be treated as an instrumentality of the national government, given the nature of its powers and functions.

In its Decision dated March twenty-second, nineteen ninety-five, the Regional Trial Court dismissed the petition, holding that the Local Government Code of nineteen ninety-one expressly withdrew tax exemptions previously granted to government-owned or controlled corporations. The court ruled that the tax exemption under Republic Act Number sixty-nine five eight was repealed by implication due to the repealing clause in Section five hundred thirty-four (f) of the Local Government Code, which abrogated all laws inconsistent with the Code. Emphasizing the policy of local autonomy and fiscal decentralization, the Regional Trial Court concluded that Mactan-Cebu International Airport Authority is liable for real property taxes on its properties effective January first, nineteen ninety-two onward.

ISSUE: Whether the Mactan-Cebu International Airport Authority is liable to pay real property taxes to the City of Cebu

RULING: The Supreme Court DENIED the petition and AFFIRMED the Regional Trial Court ruling holding that the Mactan-Cebu International Airport Authority is liable for real property taxes imposed by the City of Cebu.

Ruling and Ratio Decidendi

Instrumentality Argument Rejected

Ownership and Taxable Status

Doctrine Applied

SUPREMACY

Philippine Health Care Providers, Inc. versus Commissioner of Internal Revenue, G.R. No. one six seven three three zero, eighteen September two thousand nine

ISSUE:

RULING:

Sison versus Ancheta, G.R. No. L-five thousand nine hundred thirty-one, twenty-five July nineteen eighty-four

ISSUES: Whether the law violates the constitutional requirement of uniformity and equity in taxation.

Tio versus Videogram Regulatory Board, G.R. No. L-seven hundred fifty-six ninety-seven, eighteen June nineteen eighty-seven

ISSUES:

RULINGS:

Tolentino v. Secretary of Finance, G.R. No. one fifteen four five five twenty-five August nineteen ninety-four FACTS:

ISSUES:

RULINGS:

ISSUES:

RULINGS:

ISSUES:

RULING:

Doctrines and Taxation Principles Applied

Commissioner Of Internal Revenue v. Pilipinas Shell Petroleum Corporation, G.R. No. one hundred ninety-seven thousand nine hundred forty-five, September seven, two thousand eighteen

ISSUES:

RULING:

Doctrines and Taxation Principles Applied

Commissioner Of Internal Revenue v. Dash Engineering Philippines, G.R. No. one hundred eighty-four thousand one hundred forty-five, December eleven, two thousand thirteen

ISSUES:

RULING:

Philippine Guaranty Co., Inc. v. Commissioner Of Internal Revenue, G.R. No. L-22074, thirty April nineteen sixty-five

ISSUES:

RULING:

Doctrine:

Batangas City v. Pilipinas Shell Petroleum Corporation, G.R. No. one hundred eighty-seven six hundred thirty-one, eight July two thousand fifteen

ISSUES:

RULINGS:

Doctrine:

Film Development Council of The Philippines v. Colon Heritage Realty Corporation, G.R. No. two hundred three seven five four, sixteen June two thousand fifteen

ISSUES:

RULINGS:

Doctrine:

Saint Wealth Ltd. versus Bureau of Internal Revenue, et al., G.R. No. two hundred fifty-two nine hundred sixty-five, two hundred fifty-four one hundred two, ten January twenty twenty-three

ISSUE:

RULING:

FACTS:

ISSUES:

RULING:

Doctrine (Legislative Power of Taxation):

Overview

The Supreme Court ruled on cases regarding tax exemptions for government entities, determining that the Mactan Cebu International Airport Authority is liable for real property taxes, and that health care agreements of Philippine Health Care Providers, Inc. are not taxable under the Documentary Stamp Tax.

Key Points

1Mactan Cebu International Airport Authority's tax exemption was revoked by the Local Government Code
2The Supreme Court affirmed the liability of Mactan-Cebu International Airport Authority for real property taxes
3Philippine Health Care Providers, Inc. was determined not to be engaged in the insurance business
4Tax laws are strictly construed against the State, favoring taxpayers
5High tax assessments on HMOs could undermine public welfare and accessibility of health services

Details

Category: Law and Legal Studies

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