I. General Principles
A.Definition and Concept of Taxation
As a process, it is a means by which the sovereign, through its law-making body,raises revenue to defray the necessary expenses of the government. It is merely a way of apportioning the costs of government among those who in some measures are privileged toenjoy its benefits and must bear its burdens. As a power, taxation refers to the inherent power of the state to demand enforcedcontributions for public purpose or purposes. Taxation is a symbiotic relationship, whereby in exchange for the protection that thecitizens get from the government, taxes are paid.
B.Nature of Taxation
1. It is an inherent attribute of sovereignty 2. It is legislative in character
C.Characteristics of Taxation
1. The power of taxation is an incident of sovereignty as it isinherentin the State,belonging as a matter of right to every independent government. It does need constitutionalconferment. Constitutional provisions do not give rise to the power to tax but merely impose limitations on what would otherwise be an invincible power. No attribute of sovereignty is more pervading, and at no point does the power of government affect moreconstantly and intimately all the relations of life than through the exactions made under it.
2. The power to tax is inherent in the State, and the State is free to select the objectoftaxation, such power being exclusively vested in the legislature, exceptwhere theConstitution provides otherwise.
The Congress may by law authorize the President to fix within specified limits, andsubject to such limitations and restrictions as it may impose, tariff rates, import and exportquotas, tonnage and wharfage dues, and other duties or imposts within the framework of thenational development program of the Government.Each local government unit shall have the power to create its own sources of revenues and to levy taxes, fees, and charges subject to such guidelines and limitations as theCongress may provide, consistent with the basic policy of local autonomy. Such taxes, fees,and charges shall accrue exclusively to the local governments.
Commissioner of Internal Revenue vs.Allegre, Inc., et al
., L-28896, Feb. 17, 1988
Churchill and Tait v. Concepcion
, 34 Phil 969
Art. VI, Sec,28 (2); Art. X, Sec. 5; Art. VI, Sec. 28. par. 2.
Art. X, Sec. 5