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    Lutz vs. Araneta, G.R. No. L-7859

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    alyza burdeos
    This case tested the constitutionality of taxes imposed by the Sugar Adjustment Act to stabilize the sugar industry. The petitioner paid taxes under the act and argued the taxes were unconstitutional because they supported only the sugar industry rather than serving a public purpose. The court ruled the taxes were a valid exercise of police power aimed at rehabilitating and stabilizing the threatened sugar industry, which was important to the national economy and welfare. Upholding the act, the court found promoting the sugar industry promoted the general welfare due to its significance as a major export, employer, and source of wealth and foreign exchange for the country.

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    Lutz vs. Araneta, G.R. No. L-7859

    Uploaded by

    alyza burdeos
    12 views1 page
    This case tested the constitutionality of taxes imposed by the Sugar Adjustment Act to stabilize the sugar industry. The petitioner paid taxes under the act and argued the taxes were unconstitutional because they supported only the sugar industry rather than serving a public purpose. The court ruled the taxes were a valid exercise of police power aimed at rehabilitating and stabilizing the threatened sugar industry, which was important to the national economy and welfare. Upholding the act, the court found promoting the sugar industry promoted the general welfare due to its significance as a major export, employer, and source of wealth and foreign exchange for the country.

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    009. Lutz vs. Araneta, G.R. No. L-7859

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    This case tested the constitutionality of taxes imposed by the Sugar Adjustment Act to stabilize the sugar industry. The petitioner paid taxes under the act and argued the taxes were unconstitutional because they supported only the sugar industry rather than serving a public purpose. The court ruled the taxes were a valid exercise of police power aimed at rehabilitating and stabilizing the threatened sugar industry, which was important to the national economy and welfare. Upholding the act, the court found promoting the sugar industry promoted the general welfare due to its significance as a major export, employer, and source of wealth and foreign exchange for the country.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    12 views1 page

    Lutz vs. Araneta, G.R. No. L-7859

    Uploaded by

    alyza burdeos
    This case tested the constitutionality of taxes imposed by the Sugar Adjustment Act to stabilize the sugar industry. The petitioner paid taxes under the act and argued the taxes were unconstitutional because they supported only the sugar industry rather than serving a public purpose. The court ruled the taxes were a valid exercise of police power aimed at rehabilitating and stabilizing the threatened sugar industry, which was important to the national economy and welfare. Upholding the act, the court found promoting the sugar industry promoted the general welfare due to its significance as a major export, employer, and source of wealth and foreign exchange for the country.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    of 1

    Title: WALTER LUTZ, vs. J.

    ANTONIO ARANETA

    Facts:

    This case was initiated to test the legality of the taxes imposed by the Sugar Adjustment Act
    (Commonwealth Act No. 567) which sought "to obtain a readjustment of the benefits derived
    from the sugar industry by the component elements thereof" and "to stabilize the sugar
    industry…”

    Petitioner, in his capacity as Judicial Administrator of the Intestate Estate of Antonio Jayme
    Ledesma, seeks to recover from the CIR the sum of P14,666.40 paid by the estate as taxes,
    under section 3 of the Act, for the crop years 1948-1949 and 1949-1950. He alleges that sec. 3
    of the law is unconstitutional and void as it levies tax for the aid and support of the sugar
    industry exclusively, which is not for a public purpose for which tax may be constitutionally
    levied upon.

    The case was dismissed by the CFI and was raised directly to the SC on appeal

    Issue: WON the tax imposed by Commonwealth Act No. 567 is constitutional and valid

    Ruling: Yes

    The tax provided for in Commonwealth Act No. 567 is not a pure exercise of the taxing power.
    The law shows that the tax is levied with a regulatory purpose, to provide means for the
    rehabilitation and stabilization of the threatened sugar industry. In other words, the act is
    primarily an exercise of the police power.

    The court further noted that the tax provided for in Commonwealth Act No. 567 that sugar
    production is one of the great industries of our nation, sugar occupying a leading position
    among its export products; that it gives employment to thousands of laborers in fields and
    factories; that it is a great source of the state's wealth, is one of the important sources of foreign
    exchange needed by our government, and is thus pivotal in the plans of a regime committed to
    a policy of currency stability. Its promotion, protection and advancement, therefore redounds
    greatly to the general welfare. Hence it was competent for the legislature to find that the general
    welfare demanded that the sugar industry should be stabilized in turn; and in the wide field of its
    police power, the lawmaking body could provide that the distribution of benefits therefrom be
    readjusted among its components to enable it to resist the added strain of the increase in taxes
    that it had to sustain.

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