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    Cta Eb CV 01117 D 2015sep21 Ass

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    Cta Eb CV 01117 D 2015sep21 Ass

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    April Gem Balucanag
    14 views2 pages
    TAX

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    CTA_EB_CV_01117_D_2015SEP21_ASS

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    14 views2 pages

    Cta Eb CV 01117 D 2015sep21 Ass

    Uploaded by

    April Gem Balucanag
    TAX

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    of 2

    G.R. No.

    L-22814 August 28, 1968


    PEPSI-COLA BOTTLING CO. OF THE PHILIPPINES, INC., plaintiff-appellant,
    vs.
    CITY OF BUTUAN, MEMBERS OF THE MUNICIPAL BOARD,
    THE CITY MAYOR and THE CITY TREASURER, all of the CITY OF BUTUAN,
    defendants-appellees

    FACTS:
    Pepsi-Cola Bottling Company of the Philippines, is a domestic corporation. On August
    16, 1960, the City of Butuan enacted Municipal Ordinance No. 110 which provides for
    the payment by "any agent and/or consignee" of any dealer "engaged in selling liquors,
    imported or local, in the City a tax of P0.10 per case of 24 bottles of the soft drinks and
    carbonated beverages (Sections 2 - 3 of the ordinance). Later, Pepsi paid the amount
    P14,177.03 under protest covering the period of August 16, 1960 to July 30, 1961.
    Thereafter, Pepsi filed an action in the court seeking to recover the sums it paid to the
    City of Butuan pursuant to its Municipal Ordinance No. 110, as amended by Municipal
    Ordinance No. 122, both series of 1960 on the ground that said municipal ordinance
    was null and void. Municipal Ordinance No. 110.

    ISSUE:
    1. WON the municipal ordinance is valid.
    2. WON the ordinance violates the rule on uniformity of taxation.

    RULING:
    1. No. Ordinance 110 of the City of Butuan, as amended by Ordinance No. 122,
    imposes a tax of P0.10 per case of 24 bottles of soft drinks or carbonated drinks only
    upon "any agent and/or consignee of any person, association, partnership, company
    or corporation engaged in selling . . . soft drinks or carbonated drinks." As such, the
    tax partakes of the nature of an import duty which is beyond defendant’s authority to
    impose by express provision of law. For, as a consequence of such measure,
    merchants engaged in the sale thereof are not subject to the tax unless they are
    agents and/or consignees of another dealer, who, in the very nature of things, must
    be one engaged in business outside the City. Besides, the tax would not be
    applicable to such agent and/or consignee, if less than 1,000 cases of soft drinks are
    consigned or shipped to him every month. When we consider, also that the tax "shall
    be based and computed from the cargo manifest or bill of lading . . . showing the
    number of cases" — not sold — but received by the taxpayer, the intention to limit
    the application of the ordinance to soft drinks brought into the city from outside
    thereof becomes apparent.
    2. YES. Even if Ordinance 110 of the City of Butuan were regarded as a tax on the sale
    of the beverages, it would still be invalid, as discriminatory. It violates the uniformity
    required by the Constitution and the law since only sales by "agents or consignees"
    of outside dealers would be subject to the tax. Sales by local dealers, not acting for
    or on behalf of other merchants, regardless of the volume of their sales, and even if
    the same exceeded those made by said agents or consignees of producers or
    merchants established outside the City of Butuan, would be exempt from the
    disputed tax.

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