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The
innovative introduction of the principle of local
autonomy under the 1987 Philippine Constitution
inevitably resulted to the grant of the power of
taxation to local government units (LGUs). Though not
absolute and unconditional, such devolution greatly
contributed to the realization of a genuine agenda to
develop the countryside.
In the
process, provinces, cities, municipalities and even
barangays, which now wield such delegated power within
their respective jurisdictions, were given the added
means to be self-sufficient, thereby not relying too
much on their individual Internal Revenue Allotments
from the national government.
No less
than the Supreme Court upheld this hypothesis in ruling
for the validity of, as the Court has labeled in the
case of National Power Corp. v. City of Cabanatuan (G.R.
No. 149110, April 9, 2003), the blanket withdrawal of
local-government tax exemptions under the Local
Government Code (Republic Act 7160) in imposing
provincial franchise taxes.
The
Supreme Court could not have said it any better when it
held that “the power to tax is the most effective
instrument to raise needed revenues to finance and
support myriad activities of the LGUs for the delivery
of basic services essential to the promotion of the
general welfare and the enhancement of peace, progress
and prosperity of the people.”
These
aspirations, which the law endeavors to achieve, are
laudable, for most experts claim that the development of
our country must and should not be concentrated within
the realm of our highly urbanized cities.
However,
with this relatively new system that we are trying to
implement, it can never really be avoided that in the
exercise of such delegated power to tax, the
revenue-generating ordinance passed by a particular LGU
may run counter with the limitations mandated under the
law and questions raised on its validity and
constitutionality.
When the
constitutionality of a local revenue-generating measure
is being put to the test, Section 187 of the Code
requires that the same be raised first to the secretary
of Justice within 30 days from its effectivity.
If and
when the Justice secretary fails to render a decision
within 60 days from receipt of the appeal, the aggrieved
party may file the appropriate proceedings with a court
of competent jurisdiction. Despite all these, the
taxpayer concerned must bear in mind that the payment of
the tax must still be made since the effectivity of any
local revenue-generating measure is not suspended by the
mere filing of such case. (Jaime C. Lopez v. City of
Manila et. al., G.R. 127139, February 19, 1999)
Just
recently, a controversy erupted in the province of
Pampanga when the provincial board passed Ordinance 172
with the aim of allegedly correcting the distribution of
the proceeds of the tax on the quarry lahar deposits.
The
provincial board surprisingly denied the provincial
government from collecting the P150 “administrative
cost” out of the P300 tax imposed for every truckload of
sand.
In lieu
of this, the Sangguniang Panlalawigan maintained that
the province is entitled only to 30 percent of the whole
amount sans the administrative cost previously imposed
on top of its 30-percent share from the remaining half
of the collected revenue, while the municipality and
barangay where the lahar was extracted is respectively
entitled to 30 percent and 40 percent of the amount
collected.
The
chief local executive raised a howl and is now mulling
over the use of his veto powers, saying that the
distribution of basic services and projects for the
development of the province, and ultimately their
constituents, shall greatly suffer as a result of the
provincial government’s diminished share from the
collected taxes.
In
response to this, the Sangguniang Panlalawigan countered
that the new ordinance is just being fair to the
municipalities and barangays where the quarry operations
are being made, and that the same is what the law
mandates. It is ironic, though, that both parties have
the same reason in espousing their stand—the delivery of
basic services to the people and the ensuing development
of the affected LGUs.
The
contending parties have valid points against the other.
What is amusing, though, is that the provincial board
has taken the initiative to make a shortcut and swallow
the bitter pill of decreasing its revenues. The law
provides that the affected party, which in this case are
the municipalities and barangays affected, may initiate
the proper proceedings in questioning the
constitutionality of a particular revenue-generating
measure. But none was introduced in them.
However,
with all the righteous, albeit conflicting, objectives
of these men, let us just hope that we should all learn
from this example so that after the internal bickering
and the ensuing power struggle, the welfare of the
people and the ensuing development of the countryside as
the embodied intention of the law remains paramount over
all the considerations being made.
The author is an associate of BDB Law. If you have any
comments or questions concerning the article, you can
e-mail the author at oliver.gil.m.beltran@bdblaw.com.ph
or call 8562952. |
