TAX LAW REVIEW

2nd Semester, AY 2019-2020

Prof. R. R. Dujunco

Course objectives:
1. To serve as a refresher course for Tax 1 and Tax 2 subjects, highlighting topics that are included
in the Bar Exam coverage.
2. To provide a review of tax principles, with emphasis on keywords as stated in the Tax Code
and/or jurisprudence.

Grades:
Recitation/Attendance 30% includes quizzes and assignments
Midterms 30% covers General Principles and Income Tax
Finals 40% covers Tax 1 and Tax 2

Suggested Text: Reviewer on Taxation, 2019 ed. by Mamalateo and Mamalateo

Any bar review material on Taxation, just make sure it’s updated as to the TRAIN
LAW and CMTA

Provisions cited below pertain to the 1997 NIRC, as amended , unless otherwise stated.

I. GENERAL PRINCIPLES OF TAXATION

A. Definition, Concept and Purpose of Taxation

B. Nature and Characteristics of Taxation

1. Nature
2. Characteristics

• Chamber of Real Estate and Builders’ Association v. Romulo, 614 SCRA 605, 2010
• Secretary of Finance v. Lazatin, G.R. No. 210586, G.R. No. 210588, 2016

C. Power of Taxation as distinguished from Police Power and Power of Eminent Domain
• Southern Luzon Drug v. DSWD, G.R. No. 199669, 2017
• Drugstores Association of the Philippines v. National Council on Disability Affairs,
G.R. No. 194561, 2016
• CIR v. Central Luzon Drug Corporation, G.R. No. 159647, 2005

D. Theory and Basis of Taxation

1. Lifeblood Theory
2. Necessity Theory
3. Benefits-Protection Theory (Doctrine of Symbiotic Relationship)
• CIR v. Algue, G.R. No. L-28896, 1988
• Phil. Guaranty Co. v. CIR, G.R. No. L-022074, 1965

E. Principles of a Sound Tax System

F. Scope and Limitations of Taxation

1. Inherent limitations
a) Public purpose
• Pascual v. Secretary of Public Works, G.R. No. L-10405, 1960
b) Inherently legislative, non-delegability of the power to tax, exceptions
• Film Development Council v. Colon Heritage Realty, G.R. No. 203754, 2015

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 c) International Comity
• Deutsche Bank AG Manila Branch v. CIR, G.R. 188550, 2013

d) Exemption of Government Entities, Agencies and Instrumentalities

• Maceda v. Macaraeg, Jr., G.R. No. 88291, 1991

2. Constitutional limitations – 1987 Constitution

a) Prohibition against imprisonment for non-payment of poll tax. Art III, Sec. 20

b) Uniformity and equality of taxation. Art VI, Sec. 28

• CIR v. DLSU, G.R. No. 196596, 2016
• White Light Corporation v. City of Manila, G.R. No. 122846, 2009

c) Grant by Congress of authority to the President to impose tariff rates. Art. VI, Sec.28

d) Prohibition against taxation of religious, charitable entities, and educational entities.

Art. VI, Sec. 28

e) Prohibition against taxation of non-stock, non-profit institutions, Art XIV, Sec. 4

- 1997 NIRC, Secs. 27(B), 30(E) and (G)
- RMO No. 44-2016
• CIR v. DLSU, supra
• Jacinto-Henares v. St. Paul College of Manila, G.R. No. 215383, 2017
• Lung Center of the Phils., v. Quezon City, G.R. No. 144104, 2004
• CIR v. St. Luke’s Medical Center, G.R. No. 203514, 2017

f) Majority vote of Congress for grant of tax exemptions. Art. VI, Sec. 28

g) Prohibition on use of tax levied for special purpose. Art. VI, Sec. 29

h) President’s veto power on appropriation, revenue, tariff bills. Art. VI, Sec. 27
- President’s veto message on TRAIN1

i) Non-impairment of jurisdiction of Supreme Court. Art. VIII, Sec. 5

j) Grant of power to the LGUs to create their own sources of revenue. Art. X, Sec. 5

k) Flexible tariff clause. Art VI, Sec. 28

l) Exemption from real property taxes. Art. VI, Sec. 28

m) No appropriation or use of public money for religious purposes. Art. VI, Sec. 29

n) Mandate for Congress to evolve a progressive system of taxation. Art. VI, Sec. 29
• Southern Cross Cement v. Cement Manufacturer’s Assoc., G.R. No. 158540, 2005

o) Origination of appropriation, revenue or tariff bills. Art. VI, Sec. 24

p) Automatic release of LGUs’ just share in national taxes. Art. X, Sec. 6

q) Tax exemption of grants, endowments, donations, or contributions. Art. XIV, Sec. 4.

r) Constitutional provisions that indirectly affect taxation

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 - Art. III, Secs. 1, 4, 5, 9, 10,
• Manila Electric Company v. Province of Laguna, G.R. No. 131359, 1999
• Smart Communications, Inc. v. City of Davao, G.R. No. 155491, 2008

G. Situs of Taxation – Sec. 42

• Air Canada v. CIR, G.R. No. 169507, 2016

H. Stages or Aspects of Taxation

J. Requisites of a Valid Tax

K. Tax as distinguished from other forms of exactions

1. Tariff
2. Toll
3. License Fee
4. Special Assessment
5. Debt

L. Kinds of Taxes

M. Sources of Tax Laws

N. Construction and Interpretation of

1. Tax Laws
• Hilado v. Collector of Internal Revenue, G.R. No. L-9408, 1956
• CIR v. Fortune Tobacco, 559 SCRA 160, 2008
2. Tax Exemptions and Exclusions
• Cagayan Electric Power v. City of CDO, G.R. No. 191761, 2012
• CIR v. Eastern Telecommunications Philippines, G.R. No. 163835, 2010
• Soriano v. Secretary of Finance, G.R. No. 184450, 2017

3. Tax Rules and Regulations

- see definition of RRs, RMCs and RMOs at www.bir.gov.ph

4. Penal provisions of Tax Laws, statute of limitations

5. Non-retroactive application to Taxpayers – Sec. 246

• CIR v. Acosta, etc., G.R. No. 154068, 2007
• CIR v. Filinvest Development Corp., 654 SCRA 56, 2011

O. Doctrines in Taxation
1. Prospectivity of Tax Laws

2. Imprescriptibility of Taxes

3. Double Taxation – with modes of eliminating double taxation

• Nursery Care Corporation v. Acevedo, G.R. No. 180651, 2014

4. Power to Tax involves Power to Destroy

• Tridharma Marketing Corporation v. CTA, G.R. No. 215950, 2016

5. Escape from Taxation

a) Shifting of Tax Burden, impact v. incidence – Sec. 105

b) Tax Avoidance v. Tax Evasion

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 • CIR v. Estate of Benigno Toda, 438 SCRA 290, 2004

6. Exemption from Taxation – 1987 Const., Article VI, Sec. 28. Article XIV, Sec. 4.
• Nitafan v. CIR, 152 SCRA 284
• Mactan Cebu International Airport v. Marcos, 261 SCRA 667

7. Doctrine of Equitable Recoupment

• UST v. Collector, 104 Phil. 1062

8. Compensation and Set-off

• Republic v. Mambulao Lumber, 4 SCRA 622, 1962
• Domingo v. Garlitos, 8 SCRA 443
• CIR v. Toledo Power Company, G.R. No. 196415, 2015

9. Compromise and Tax Amnesty

- Sec. 204
- R.A. 11213 and Veto message
• CS Garment Inc. v. CIR, G.R. No. 182399, 2014

10.Taxpayer’s Suit
a) Nature and Concept
b) As distinguished from a citizen’s suit
• Province of North Cotabato v. Government, G.R. No. 183591, 2008
c) Requisites of a taxpayer’s suit challenging the constitutionality of a tax measure or act
of a taxing authority; concept of locus standi, doctrine of transcendental importance and ripeness
for judicial determination
• Landbank of the Philippines v. Cacayuran, G.R. No. 191667, 2013
• Southern Hemisphere Engagement Network v. Anti-terrorism Council, G.R. No.
178552, 2010

II. NATIONAL TAXATION (NATIONAL INTERNAL REVENUE CODE OF 1997, as amended.

A. Organization and Functions of the Bureau of Internal Revenue

1. Rule-making authority of the Secretary of Finance

a) Authority of the Secretary of Finance to promulgate rules and regulations

b) Specific provisions to be contained in rules and regulations

2. Jurisdiction, Power and Functions of the Commissioner of Internal Revenue – Secs. 2-8
Memorize: Sec. 7.

a) Powers and duties of the Bureau of Internal Revenue – Sec. 2

b) Power of the Commissioner to interpret tax laws and to decide tax cases – Sec. 4
- Rulings of first impression – RAO No. 1-99
- See list of “No Ruling Areas”
• Commissioner of Customs v. Hypermix Feeds Corp., G.R. No. 179579, 2012

c) Non-retroactivity of rulings – Sec. 246

• RR No. 5-2012 + RMC No. 22 -2012
• Deutsche Knowledge Services v. CIR, G.R. No. 197980, 2016

B. Income Tax

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Revenue Regulations No. 11-2018
Revenue Regulations No. 10-2008

1. Definition, Nature and General Principles – Sec. 22-23

a) Income Tax systems

– Global, Schedular and Semischedular or Semi-Global Taxpayer’s income

b) Features of the Philippine Income Tax Law – Sec. 32

– direct, progressive, comprehensive, semi-schedular/semi-global

c) Criteria in imposing Philippine income tax – Sec. 23, 42

1. Domicillary Theory
2. Nationality Theory
3. Source

d) Types of Philippine income taxes

– gross income vs. taxable income

e) Taxable period
– accounting period vs. taxable year
– calendar vs. fiscal
– annual vs. quarterly vs. monthly
– short period return

f) Kinds of taxpayers – Sec. 22(A), (N)

2. Income Tax
a) Definition, Nature and General principles – Sec. 23

b) Income
(1) Definition and nature
– income vs. capital
• Fisher v. Trinidad, 43 Phil 973

(2) When income is taxable

i. Existence of income
– advances vs. revenues
– taxable income vs. accounting income
• CIR v. Lancaster Philippines, G.R. No. 183408, 2017

ii. Realization of income

iii. Recognition of income

– actual vs. constructive receipt
• CIR v. Citytrust Investment Phils., G.R. No. 139786, 2006

iv. Cash method of accounting versus Accrual method of accounting –

Sec. 43
• CIR v. Isabela Cultural Corporation, G.R. No. 172231, 2007

(3) Tests in determining whether income is earned for tax purposes (no need to
read the cases, just get the definitions)
i. Realization test

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 ii. Claim of right doctrine or doctrine of ownership, command or
control – defined in Helvering v. Horst, 311 US 112
iii. Economic benefit test, doctrine of proprietary interest – defined
in Commissioner v. LaBue, 351 US 243
iv. Severance test – defined in Eisener v. Macomber, 252 US 189
v. All events test

c) Classification of income – Secs. 24, 25, 27 and 28

d) Situs of Income Taxation – Sec. 42

3. Gross Income

a) Definition – Sec. 32

b) Concept of income from whatever source derived – Sec. 32

c) Gross income vis-à-vis net income vis-à-vis taxable income – Secs. 31 - 32

d) Sources of income subject to tax – Sec. 42

e) Classification of income subject to tax – Sec. 32

f) Exclusions from gross income

g) Fringe benefits - Sec. 33, Revenue Regulations No. 3-98

(1) Rank and file vs. non-rank and file
(2) Different types of taxable fringe benefits
(3) Non-taxable fringe benefits
(4) De minimis benefits

4. Capital Gains and Capital Losses

5. Deductions from Gross Income – Secs. 34 to 41

a) General rules
b) Return of capital
c) Itemized deductions – look for the requisites for each type of allowable deduction
d) Optional Standard Deduction – Sec. 34(L)
e) Items not deductible
f) Deductions with limits

6. Income Tax on Individuals – Secs. 24 to 26

a) Income Tax on Resident Citizens, Non-resident Citizens and Resident Aliens
(1) Coverage – Income from all sources within and without the Philippines;
exceptions
(2) Taxation on compensation income
(i) Inclusions – monetary and nonmonetary compensation
(ii) Exclusions – Fringe benefits subject to tax; De Minimis benefits; 13th
month pay and other benefits and payments specifically excluded from
taxable compensation income
(iii) Deductions – Personal and additional exemptions; Health and
hospitalization insurance
(3) Taxation of business income/income from practice of profession
(4) Taxation of Passive Income
(5) Taxation of Capital Gains
b) Income Tax on Non-Resident Aliens Engaged in Trade or Business
c) Income Tax on Non-Resident Aliens Not Engaged in Trade or Business

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 d) Individual Taxpayers Exempt from Income Tax
(1) Senior citizens
(2) Minimum wage earners
(3) Exemptions granted under international agreements

7. Income Tax on Corporations – Secs. 27 to 30

a) Income Tax on Domestic Corporations and Resident Foreign Corporations

(1) Regular tax
(2) Minimum Corporate Income Tax (MCIT)
(3) Branch Profit Remittance Tax
(4) Allowable deductions
(i) Itemized deductions
(ii) Optional Standard Deductions
(5) Taxation of Passive Income
(6) Taxation of Capital Gains
(7) Gross Philippine Billings
• South African Airways v. CIR, G.R. No. 180356, 2010
• Air Canada v. CIR, G.R. No. 169507, 2016

b) Income Tax on Non-Resident Foreign Corporations - Sec. 28(B)

c) Income Tax on Special Corporations

(1) Domestic Corporations
(i) Proprietary educational institutions and hospitals
(ii) Non-profit hospitals
(iii) Government-owned or controlled corporations, agencies or
instrumentalities
(iv) Depository banks (foreign currency deposit units)
(2) Resident Foreign Corporations
(i) International carriers doing business in the Philippines
(ii) Off-shore banking units
(iii) Resident depository banks (foreign currency deposit units)
(iv) Regional or Area Headquarters and Regional Operating
Headquarters of Multinational Companies
(3) Improperly Accumulated Earnings Tax (IAET) – Sec. 29
• CIR v. Ayala Securities Corp., G.R. No. L-29485, 1980
(4) Exemptions from Tax on Corporations – Sec. 30
(5) Tax on other Business Entities: General Partnerships, General Professional
Partnerships, Co-ownerships, Joint Ventures and Consortia – Secs. 26, 60-66

8. Filing of Returns and Payment of Income Tax – Secs. 51 to 58

a) Definition of a Tax Return and Information Return
b) Period within which to file Income Tax Return of Individuals and Corporations
c) Persons liable to file Income Tax Returns
(1) Individual taxpayers
(i) General rule and exceptions
(ii) Substituted filing – Sec. 51.A.
(2) Corporate taxpayers
d) Where to file Income Tax Returns
e) Penalties for Non-filing of Returns

9. Withholding of taxes
a) Concept of withholding taxes
b) Kinds of Withholding Taxes

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 10. Bookkeeping Requirements

C. Estate Taxes – Secs. 84 to 96

Revenue Regulations 12-2018

1. Basic principles, concept, and definition

2. Items to be included in the gross estate
3. Deductions and exclusions from estate
4. Tax credit for estate taxes paid to a foreign country
5. Exemption of certain acquisitions and transmissions
6. Filing of notice of death – repealed by TRAIN
7. Estate tax return – filing, payment, extension, installments

D. Donor’s Tax – Secs. 97 to 104

1. Basic principles, concept and definition
2. Nature, purpose and object
3. Time and transfer of properties
4. Requisites of a valid donation
5. Transfer for less than adequate and full consideration
6. Campaign contributions
7. Exemption of certain gifts from donor’s tax
8. Donor’s Tax Return – filing and payment

E. Value-Added Tax (VAT) – Secs. 105 to 115

Revenue Regulations 16-2005

Revenue Regulations 13-2018

1. Concept, characteristics/elements of VAT-taxable transactions

2. Impact and incidence of tax
3. Tax credit method
4. Destination Principle / Cross Border Doctrine
• CIR v. Toshiba Information Equipment, G.R. 150154, 2005
5. Persons liable
6. Imposition of VAT
• Mindanao Geothermal Partnership v. CIR, G.R. No. 193301 & 194637, 2013
a) On sale of goods or properties
b) On importation of goods
(1) Transfer of goods by tax exempt persons
c) On services
• CIR v. American Express, G.R. No. 152609, 2005
• CIR v. CA, G.R. No. 125355, 2000
7. Transactions deemed sale
a) Transfer, use or consumption not in the course of business of goods/properties
originally intended for sale or use in the course of business
b) Distribution or transfer to shareholders, investors or creditors
c) Consignment of goods if actual sale is not made within 60 days from date of
consignment
d) Retirement from or cessation of business with respect to inventories on hand
• CIR v. Magsaysay Lines, G.R. No. 146984, 2006
8. Change or cessation of status as VAT-registered person
a) Subject to VAT
(1) Change of business activity from VAT taxable status to VAT-exempt status
(2) Approval of request for cancellation of a registration due to reversion to
exempt status

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 (3) Approval of request for cancellation of registration due to desire to revert to
exempt status after lapse of 3 consecutive years
b) Not subject to VAT
(1) Change of control of a corporation
(2) Change in the trade or corporate name
(3) Merger or consolidation of corporations
9. Zero-rated and effectively zero-rated sales of goods or properties
10.VAT-exempt transactions
a) VAT exempt transactions; in general; enumeration
• CIR v. Seagate Technology, G.R. No. 153866, 2005
• CIR v. Cebu Toyo Corporation, 451 SCRA 447
11. Input and Output tax
• Kapatiran ng Naglilingkod sa Pamahalaan, 163 SCRA 371
• Philippine Geothermal Inc. v. CIR, G.R. No. L-154028, 2005
• Fort Bonifacio Development Corp v. CIR, G.R. No. 173425, 2013
a) Definition
b) Sources of input tax
(1) Purchase or importation of goods
(2) Purchase of real properties for which VAT has actually been paid
(3) Purchase of services for which VAT has actually been paid
(4) Transactions deemed sale
(5) Presumptive input
(6) Transitional input
c) Persons who can avail of input tax credits
d) Determination of output/input tax; VAT payable; excess input tax credits
(1) Determination of output tax
(2) Determination of creditable input tax
(3) Allocation of input tax on mixed transactions
(4) Determination of the output tax and VAT payable and computation of VAT
payable or excess tax credits
e) Substantiation of input tax credits
12. Refund or tax credit of excess input tax
a) Who may claim for refund/apply for issuance of tax credit certificates
b) Period to file claim/apply for the issuances of tax credit certificates
c) Manner of giving refunds
d) Destination principle/Cross-border doctrine
• Philex Mining Corp v. CIR, G.R. No. 125704, 1998
• Atlas Consolidated Mining v. CIR, 524 SCRA 73 (2007)
• CIR v. Mirant Pagbilao, G.R. No. 172129, September 12, 2008
• CIR v. Aichi Forging Company, G.R. No. 184823, October 6, 2010
• CIR v. San Roque Power Corporation, G.R. Nos. 187485, 196113, and
197156, February 12, 2013
• KEPCO Philippines v. CIR, G.R. No. 181858, November 24, 2010.
• Pilipinas Total Gas Inc v. CIR, G.R. No. 207112, 2015
13. Invoicing Requirements
a) In general
b) In “deemed sale” transactions
c) Consequences of issuing erroneous VAT invoice or VAT official receipt
14.Filing of returns and payment
15.Withholding of final VAT on sales to government

F. Tax Remedies under the NIRC

• Philamlife v. Secretary of Finance, G.R. No. 210987, 2014

• Collector v. Bautista and Tan, G.R. No. L-12250 & L-12259, 1959

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 • CIR v. Philippine Daily Inquirer, G.R. No. 213943, 2017
• CIR v. Enron Subic Power, G.R. No. 166387, 2009
• CIR v. Fitness by Design, G.R. No. 215957, 2016
• Medicard Philippines, Inc. v. CIR, G.R. No. 222743, 2017
• Lhuiller v. CIR, G.R. No. 166786, 2006

1. General Concepts
a) Assessment – Sec. 6
(1) Definition and requisites of a valid assessment – Sec. 203, 228
b) Tax delinquency as distinguished from Tax deficiency
c) Jeopardy assessment
d) Prescriptive period for assessment – Secs. 203 and 222
(1) General rule
(2) False or fraudulent returns and non-filing of returns
(3) Suspension of the running of statute of limitations
• Revenue Memorandum Order 14-2016

2. Civil penalties, additions to the tax

a) Delinquency interest and deficiency interest
b) Surcharge
c) Compromise penalty

3. Assessment process and reglementary periods –

Revenue Regulations No. 12-1999
Revenue Regulations No. 7-2018

a) Letter of Authority and Tax Audit

b) Notice of Informal Conference
c) Issuance of Preliminary Assessment Notice; general rule and exceptions
d) Issuance of Formal Letter of Demand and Final Assessment Notice
e) Disputed Assessment

4. Collection
a) Requisites
b) Prescriptive periods; suspension of running of statute of limitations

G. Taxpayer’s remedies

1. Protesting an assessment – Revenue Regulations No. 12-99

a) Protested assessment
b) Period to file protest
c) Form, content, and validity of protest
d) Submission of supporting documents
e) Effect of failure to file protest
f) Decision of the Commissioner on the protest filed
(1) Period to act upon or decide on protest filed
(2) Remedies of the taxpayer in case the Commissioner denies the protest or
fails to act on the protest
(3) Effect of failure to appeal
• RCBC v. CIR, G.R. No. 168498, 2007
• Lascona Land Co. v. CIR, G.R. No. 171251, 2012
• CIR v. Kudos Metal Corporation, G.R. No. 178087, 2010
• Fishwealth Canning Corp v. CIR, G.R. No. 179343, 2010
• CIR v. V.Y. Domingo Jeweller, Inc., G.R. No. 22178, 2019

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 2. Compromise and abatement of taxes – Sec. 204

3. Recovery of Tax Erroneously or Illegally Collected

a) Tax refund as distinguished from Tax credit
b) Grounds, requisites and period for filing a claim for refund or issuance of a tax credit
certificate
c) Statutory basis and proof of claim for refund or tax credit
d) Proper party to file claim for refund or tax credit

H. Government remedies
• CIR v. Philippine Global Communications, G.R. No. 167146, 2006
1. Administrative remedies
a) Tax lien
b) Distraint and levy
c) Forfeiture of real property

d) Suspension of business operation

e) Non-availability of injunction to restrain collection of tax

2. Judicial remedies – civil or criminal action

III. LOCAL TAXATION [LOCAL GOVERNMENT CODE (LGC) OF 1991, as amended]

A. Local government taxation

• Film Development Council v. Colon Heritage Realty, G.R. No. 203754, 2015
• City of Iriga v. CASURECO III, G.R. No. 192945, 2012
• City of Manila v. Cosmos Bottling, G.R. No. 196681, 2018
• SM Land v. City of Manila, G.R. No. 197151, 2012

1. Fundamental principles – memorize Sec. 130, LGC

2. Nature and source of taxing power – 1987 Const., Article X, Secs 5 and 6
a) Grant of local taxing power under the LGC
b) Authority to prescribe penalties for tax violations
c) Authority to grant local tax exemptions – Sec. 192, LGC
d) Withdrawal of exemptions
e) Authority to adjust local tax rates – Sec. 191, LGC
f) Residual taxing power of local governments – Sec. 186, LGC
g) Authority to issue local tax ordinances – Secs. 187 to 189, LGC

3. Local taxing authority

a) Power to create revenues exercised through Local Government Units (LGUs)
b) Procedure for approval and effectivity of tax ordinances

4. Scope of taxing power

5. Specific taxing power of LGUs – pre-emption. Secs. 142, 151, LGC

6. Taxing powers of provinces (Exclude: Rates) – Secs. 135 to 141

a) Tax on transfer of real property ownership
b) Tax on business of printing and publication
c) Franchise tax
d) Tax on sand, gravel and other quarry services
e) Professional tax
f) Amusement tax
g) Tax on delivery truck/van

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 7. Taxing powers of cities (Exclude: Rates) – Sec. 143, LGC

8. Taxing powers of municipalities (Exclude: Rates)

a) Tax on various types of businesses
b) Ceiling on business taxes imposable by LGUs within Metro Manila
c) Tax on retirement of business
d) Rules on payment of business taxes
e) Fees and charges for regulation & licensing
f) Situs of tax collected – Sec. 143, LGC

9. Taxing powers of barangays (Exclude: Rates) – Sec. 152, LGC

10. Common revenue raising powers – Secs. 154-154, LGC

a) Service fees and charges
b) Public utility charges
c) Toll fees or charges

11. Community tax

12. Common limitations on the taxing powers of LGUs

13. Collection of business taxes – Secs. 165 to 170, LGC

a) Tax period and manner of payment
b) Accrual of tax
c) Time of payment
d) Penalties on unpaid taxes, fees or charges
e) Authority of treasurer in collection and inspection of books

14.Taxpayer’s remedies
a) Periods of assessment and collection of local taxes, fees or charges – Sec. 194, LGC
b) Protest of assessment – Sec. 187, LGC
c) Claim for refund of tax credit for erroneously or illegally collected tax, fee or charge

15. Civil remedies by the LGUs for collection of revenues

a) Local government’s lien for delinquent taxes, fees or charges
b) Civil remedies, in general
(1) Administrative action
(2) Judicial action

B. Real property taxation

• Beaumont Holdings Corp v. Reyes, Villar and Endriga, G.R. No. 207306, 2017
• Ce Casecnan Water v. Province of Nueva Ecija, G.R. No. 196278, 2015

1. Fundamental principles – Sec. 199, LGC

2. Nature of real property tax – Secs. 233, 235, 236, and 240, LGC
3. Imposition of real property taxes
a) Power to levy real property taxes
b) Exemption from real property taxes – Sec. 234, LGC
4. Appraisal and assessment of real property tax
a) Rule on appraisal of real property tax at fair market value
b) Declaration of real property – Secs. 202, 222, LGC
c) Listing of real property in assessment rolls
d) Preparation of schedules of fair market values
(1) Authority of assessor to take evidence
(2) Amendment of schedule of fair market values

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 e) Classes of real property
f) Actual use of property as basis of assessment – Sec. 218, LGC
g) Assessment of property
(1) General revisions of assessments and property classifications – Sec. 219
(2) Date of effectivity of assessment or reassessment
h) Assessment of property subject to back taxes – Sec. 222, LGC
i) Notification of new or revised assessments

C. Collection of real property tax

1. Date of accrual of real property taxes and special levies – Sec. 246, LGC
2. Collection of taxes
a) Collecting authority – Sec. 247, LGC
b) Duty of assessor to furnish local treasurer with assessment rolls
c) Notice of time for collection of taxes – Sec. 249, LGC
3. Periods within which to collect real property taxes
4. Special rules on payment
a) Payment of real property taxes in installments
b) Interests on unpaid real property taxes
c) Condonation of real property taxes – Secs. 276-277, LGC
5. Remedies of LGUs for collection of real property taxes
a) Issuance of notice of delinquency for real property tax payment
b) Local government’s lien
c) Remedies in general
d) Resale of real estate taken for taxes, fees or charges
e) Further levy until full payment of amount due

D. Refund or credit of real property taxes

1. Payment under protest
2. Repayment of excessive collections

E. Taxpayer’s remedies
1. Contesting an assessment of value of real property
a) Appeal to the Local Board of Assessment Appeals (LBAA)
b) Appeal to the Central Board of Assessment Appeals (CBAA)
c) Effect of payment of tax

F. Payment of real property tax under protest

1. File protest with local treasurer
2. Appeal to the LBAA
3. Appeal to the CBAA
4. Appeal to the Court of Tax Appeals (CTA)
5. Appeal to the Supreme Court (SC)

IV. JUDICIAL REMEDIES [R.A. No. 1125, as amended, and the Revised Rules of the Court of Tax
Appeals (CTA)]
• CIR v. CTA and Petron, G.R. No. 207843, 2018
• Ignacio v. City Treasurer of Quezon City, G.R. No. 221620, 2017

A. Jurisdiction of the CTA

1. Exclusive appellate jurisdiction over civil tax cases
a) Cases within the jurisdiction of the court en banc
b) Cases within the jurisdiction of the court in divisions
2. Criminal cases
a) Exclusive original jurisdiction
b) Exclusive appellate jurisdiction in criminal cases

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B. Judicial procedures
1. Judicial action for collection of taxes
a) Internal revenue taxes
b) Local taxes
(1) Prescriptive period
2. Civil cases
a) Who may appeal, mode of appeal, effect of appeal
(1) Suspension of collection of tax
(2) Injunction not available to restrain collection
(3) Taking of evidence
(4) Motion for reconsideration or new trial
b) Appeal to the CTA, en banc
c) Petition for review on certiorari to the SC
3. Criminal cases
a) Institution and prosecution of criminal actions
(1) Institution of civil action in criminal action
b) Appeal and period to appeal
(1) Solicitor General as counsel for the people and government officials sued in
their official capacity
c) Petition for review on certiorari to the SC

V.CUSTOMS MODERNIZATION AND TARIFF ACT (R.A. NO. 10863) – if included in the 2020 Bar Tax
Syllabus

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