CONSTITUTIONAL LIMITATIONS

Due Process of Law

Delegation of Legislative Authority
Basis: Sec. 1 Art. 3 No person shall be deprived of life, liberty or property without
to Fix Tariff Rates, Imports and Export Quotas
due process of law x x x.
Basis: Sec. 28(2) Art. VI x x x The Congress may, by law, authorize the President to
Requisites :
fix within specified limits, and subject to such limitations and restrictions as it may
1. The interest of the public generally as distinguished from those of a particular impose, tariff rates, import and export quotas, tonnage and wharfage dues, and other
class require the intervention of the state;
duties or imposts within the framework of the national development program of the
2. The means employed must be reasonably necessary to the accomplishment for government.
the purpose and not unduly oppressive;
3. The deprivation was done under the authority of a valid law or of the
constitution; and
4. The deprivation was done after compliance with fair and reasonable method of
procedure prescribed by law.
Equal Protection of the Law
Tax Exemption of Properties Actually, Directly and Exclusively used for
Basis: Sec.1 Art. 3 xxx Nor shall any person be denied the equal protection of the
Religious, Charitable and Educational Purposes
laws.
Basis: Sec. 28(3) Art. VI. Charitable institutions, churches and parsonages or
Equal protection of the laws signifies that all persons subject to legislation shall be convents appurtenant thereto, mosques, non-profit cemeteries, and all lands,
treated under circumstances and conditions both in the privileges conferred and building, and improvements actually, directly and exclusively used for religious,
liabilities imposed.
charitable or educational purposes shall be exempt from taxation.
Requisites for a Valid Classification
Lest of the tax exemption: the use and not ownership of the property
1. Must not be arbitrary
To be tax-exempt, the property must be actually, directly and exclusively used for the
2. Must not be based upon substantial distinctions
purposes mentioned. The word exclusively means primarily.
3. Must be germane to the purpose of law.
The exemption is not limited to property actually indispensable but extends to
4. Must not be limited to exiting conditions only; and
facilities which are incidental to and reasonably necessary for the accomplishment of
5. Must play equally to all members of a class.
said purposes. The constitutional exemption applies only to property tax.
Uniformity, Equitability and Progressivity of Taxation
Voting Requirements in connection
Basis: Sec. 28(1) Art. VI. The rule of taxation shall be uniform and equitable. The
with the Legislative Grant for tax exemption
Congress shall evolve a progressive system of taxation.
Basis: Sec. 28(4) Art. VI. No law granting any tax exemption shall be passed
Uniformity (equality or equal protection of the laws) means all taxable articles or without the concurrence of a majority of all the members of the Congress.
kinds or property of the same class shall be taxed at the same rate. A tax is uniform The above provision requires the concurrence of a majority not of attendees
when the same force and effect in every place where the subject of it is found.
constituting a quorum but of all members of the Congress.
Equitable means fair, just, reasonable and proportionate to ones ability to pay.
Progressive system of Taxation places stress on direct rather than indirect taxes,
or on the taxpayers ability to pay
The rule of uniformity does not call for perfect uniformity or perfect equality,
because this is hardly attainable.
Freedom of Speech and of the Press
Non-impairment of the Supreme Courts jurisdiction in Tax Cases
Basis: Sec. 4 Art. III. No law shall be passed abridging the freedom of speech, of Basis: Sec. 5 (2) Art. VIII. The Congress shall have the power to define, prescribe,
expression or of the pressx x x
and apportion the jurisdiction of the various courts but may not deprive the Supreme
There is curtailment of press freedom and freedom of thought if a tax is levied Court of its jurisdiction over cases enumerated in Sec. 5 hereof.
in order to suppress the basic right of the people under the Constitution.
Sec. 5 (2b) Art. VIII. The Supreme Court shall have the following powers: x x
A business license may not be required for the sale or contribution of printed x(2) Review, revise, modify or affirm on appeal or certiorari x x x final judgments and
materials like newspaper for such would be imposing a prior restraint on press orders of lower courts in x x x all cases involving the legality of any tax, impost,
freedom
assessment, or toll or any penalty imposed in relation thereto.
However, an annual registration fee on all persons subject to the value-added
tax does not constitute a restraint on press freedom since it is not imposed for
the exercise of a privilege but only for the purpose of defraying part of cost of
registration.
Non-infringement of Religious Freedom
Tax Exemptions of Revenues and Assets, including grants, endowments,
Basis: Sec. 5 Art. III. No law shall be made respecting an establishment of religion
donations or contributions to Educational Institutions
or prohibiting the free exercise thereof. The free exercise and enjoyment of religious Basis: Sec. 4(4) Art. XIV. Subject to the conditions prescribed by law, all grants,
profession and worship, without discrimination or preference, shall be forever be endowments, donations or contributions used actually, directly and exclusively for
allowed. x x
educational purposes shall be exempt from tax.
License fees/taxes would constitute a restraint on the freedom of worship as The exemption granted to non-stock, non-profit educational institution covers
they are actually in the nature of a condition or permit of the exercise of the income, property, and donors taxes, and custom duties.
right.
To be exempt from tax or duty, the revenue, assets, property or donation must be
However, the Constitution or the Free Exercise of Religion clause does not prohibit used actually, directly and exclusively for educational purpose.
imposing a generally applicable sales and use tax on the sale of religious materials In the case or religious and charitable entities and non-profit cemeteries, the
by a religious organization. (see Tolentino vs Secretary of Finance, 235 SCRA 630)
exemption is limited to property tax.
The said constitutional provision granting tax exemption to non-stock, non-profit
Non-impairment of Contracts
educational institution is self-executing.
Basis: Sec. 10 Art. III. No law impairing the obligation of contract shall be passed.
A law which changes the terms of the contract by making new conditions, or Tax exemptions, however, of proprietary (for profit) educational institutions
changing those in the contract, or dispenses with those expressed, impairs the require prior legislative implementation. Their tax exemption is not selfexecuting.
obligation.
The non-impairment rule, however, does not apply to public utility franchise since a Lands, Buildings, and improvements actually, directly, and exclusively used for
franchise is subject to amendment, alteration or repeal by the Congress when the educational purposed are exempt from property tax, whether the educational
institution is proprietary or non-profit.
public interest so requires.
Subject and Title of Bills (Sec. 26(1) 1987 Constitution) Every Bill passed by Congress shall embrace
Non-imprisonment for non-payment of poll tax
Basis: Sec. 20 Art. III. No person shall be imprisoned for debt or non-payment of only one subject which shall be expressed in the title thereof.
poll tax.
Power of the President to Veto items in an Appropriation, Revenue or Tariff Bill (Sec. 27(2), Art. VI of
The only penalty for delinquency in payment is the payment of surcharge in the the 1987 Constitution)The President shall have the power to veto any particular item or items in an
form of interest at the rate of 24% per annum which shall be added to the Appropriation, Revenue or Tariff bill but the veto shall not affect the item or items to which he does not
object.
unpaid amount from due date until it is paid. (Sec. 161, LGC)
The prohibition is against imprisonment for non-payment of poll tax. Thus, a Appropriation of Public Money for the benefit of any Church, Sect, or System of Religion (Sec. 29(2),
person is subject to imprisonment for violation of the community tax law other than for Art. VI of the 1987 Constitution) No public money or property shall be appropriated, applied, paid or
employed, directly or indirectly for the use, benefit, support of any sect, church, denomination, sectarian
non-payment of the tax and for non-payment of other taxes as prescribed by law.
institution, or system of religion or of any priest, preacher, minister, or other religious teacher or dignitary as
Origin or Revenue, Appropriation and Tariff Bills
such except when such priest, preacher, minister or dignitary is assigned to the armed forces or to any penal
Basis: Sec. 24 Art. VI. All appropriation, revenue or tariff bills, bill authorizing institution, or government orphanage or leprosarium.
increase of the public debt, bills of local application, and private bills shall originate Taxes levied for Special Purpose (Sec. 29(3), Art. VI of the 1987 Constitution) All money collected or
exclusively in the House of Representatives, but the Senate may propose or concur any tax levied for a special purpose shall be treated as a special fund and paid out for such purpose only. It
the purpose for which a special fund was created has been fulfilled or abandoned the balance, if any, shall be
with amendments.
Under the above provision, the Senators power is not only to only concur transferred to the general funds of the government.
with amendments but also to propose amendments. (Tolentino vs Sec. of Allotment to Local Governments
Finance, supra)
Basis: Sec. 6, Art. X of the 1987 Constitution Local Government units shall have a just share, as
determined by law, in the national taxes which shall be automatically released to them.