RePublic of the PhiliPPines

DEPARTMENT OF THL INTERIOR AND LOCAL GOVERNMENT

A. Francisco Gold Condominium ll Bldg' EDSA
corner Mapagmahal St', Diliman, Quezon City

OffICE OF TtItr SECRETARY

DILG OPINTON NO. 47 S. 2OIO

16 APril 2010

ilS. I-ANEUTA I. GONZAI"EZ

Secretary to the Sanggunian
Municipality of del Gallego
Province of Camarines Sur

Dear Ms. Gonzales:

This concerns your letter-query seeking the opinion of this

Oepartment as to the form of legislative output (resolution . or
orciinanc") that the local sanggunian should pass in
providing for tax
amnesty on the payments of real properties'

In this regard, please be informed that we already answered .a

similar query in- DILG Opinion No. 49, series of 2008, dated 01 July
2008. in siiO opinion, conferment to the Governor of the power be to
enter into compromise agreements with tax delinquents cannot
done through a mere resolution.

For your ready reference, please find the attached photocopy of

the said DILG OPinion.

VerY trulY Yours,

BY AUTHORITY OF THE SECRETARY:

!
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t ATTY. JESUS B. DOQUE lY
Director III, Le.{al Service
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 ITI,PTJBLIC] OI' 11IN PI'IILIPPINI]S
DEFA,RTM['N'['ON TI.I T' IN'I'II,RN0I{ ANO [,OCAL GOVEI{NMENT
Francisco Cold Condominiunr ll, tiDSA cor' Mapagntahal St.'
Diliman, Quceon Oity
@trFtIG OF ]THtr U,IINDERtrCRHTARY IF@R t@CAt G@VEIRINNNENIT

O1 July 2OOB

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HON. MA. CHONA [4. DIIT,IAYUGA
Sangguniang Panlalawigan Member
Provincial Capitol Building
Capitol Site, Batangas City

Dear SP Member Dimayuga:

This has reference to your letter requesting for this Department's legal
opinion regarding the Resolution passed by the Sangguniang Panlalawigan of
that province.

You stated that in a special session held on O5 February 2OOa, the

Sangguniang Panlalawigan passecl "A Resolution Authorizing Goaernor
Vilma Santos Recto To Enter Iflto Cornprotnise Agreernents With
Tosc. Delinquents, Subject To The Ratification Of The Sangguniang
Panlalanuigan".

You altegedly opposed the passage of the said Resolution on the

ground that any compromise agreements will result to a reduction or
condonation of provincial taxes and will contravene an existing provincial
ordinance. Such being the case, a mere Resolution will not suffice;
reduction or condonation of real property taxes are only allowed under
Sections 276 and 277 of the Local Oovernment Code; under Sections 152
and 192 of the same Code, taxation and/or tax reliefs are legislative
functions and as such, cannot be delegated to the Covernor; and assuming
that it crn be delegated, the delegation should be complete in all its
essential terans and conditions so that there will be nothing left for the
delegate to do but to enforce it in accordance with the established
standards set therein.

It is now your contention that said Resolution passed by that

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(b) the
sariggunian is ultra vires because: (a) it is a mere Resolution;
intention to enter into compromise agreements with delinquent taxpayers is
a dangerous practice of tax collection as taxes should be uniform and not
on a case to case basis, negotiated tax compromise will open the floodgates
tograftandcomrption;(c)theResolution,evenifitcanbeconsidereda
valid delegation, did not set any slandards on how the compromise can be
implemenied. The clause "subject to the rqtificdtion of the
SangguniangPanlalawigan"isnotthecompletenessandboundaries
required of a valid delegation.

In reply, please be informed that we concur with your observations'

The subject Resolution indeed appears to be ultra vires in all respects. In
the case of Municipality of ParaRaque vs. V.M. Realty Qorporation (O'R' No'
l27A2O,2O July l9B8), the supreme court had the occasion to distinguish
an ordinance from a resolution, in this manner: "drt ordinance is a law
but a resolution is merelg a declaration of the sentiment or opinion
of a lano tnaking bodg on a specific natter; an ordinance possesses
a general and perntanent character but a resolution is tetnporary
in'nature; an ordinance prouides d pernldnent ntle of conductqnd or
clctlon but q resolution prouides a ,r.ere opinion or uiew
temporarg in characteru. Additionally, "the tuo dre endcted
different[g - third reading is necessa'ry for an ordina'nce but not for
a resolution, unless decided otheruise bg a najoritg of all the
Sanggunian mentbers". In this regard, once a provincial ordinance is
approved, nothing is left to the Covernor except his/her duty, relative to the
govemance of the province, to enforce and execute the approved ordinance
in accordance with the terms and conditions thereof [sec. 465 (b) (2), tocal
Oovemment CodeJ.

We fulty concur with your first observation that conferment to the

Qovemor of the power to enter into compromise agreements with tax
delinquents cannot be done through a mere resolution. It is worth noting
that with regard to Provincial Tax ordinance No. 5, s.2OO4, nothing is left
anyrnore to be done by the covernor except to implement and execute the
same pu rsuant to Section 465 (b) (2) of the l,ocal Government Code' It
bears to emphasize however, that the said ordinance did not confer unto
the Covernor the power to enter into compromise agreements with tax
delinquents. Accordingly, in furtherance to the enforcement of the said tax
ordinance, a subsequent Resolution authorizing the oovernor to enter into

I
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compromise agreements v/ith tax delinquents is not only defective as having

been done by way of a mere Resolution and not in an ordinance, but it is
also an undue delegation of the Sanggunian's legislative functions to the
I' Covemor considering that, assuming that a Resolution would suffice, the
same failed to provide a complete delegation of a legislative function for its
failure to provide a set of standards and criteria to ensure that said power to
enter into a compromise shall be reasonably exercised and that the
provincial govemment is not uncluly deprived of the much lreeded revenues.

Hence, if at all the Oovernor should be empowered to enter into

compromise agreement with delinquent taxpayers, said power must have
been provided in the tax ordinance itself or if belatedly thought of, must be
provided in a subsequent ordinance amplifying and supplementing the
previous tax ordinance. Moreover, to avoid an undue delegation of
legislative power and to ensure that the delegate will reasonably exercise
the power, the subsequent ordinance should already set the parameters
under r,vhich the power can be exercised.

With respect to your second observation, it bears to stress that the

l.ocal Oovemment Code, particularly Chapter lV, Section 174, provides for
the civil remedies that can be availed of by the local govemment units in the
collection of local tax, fees, charges and/or surcharges and interests
resulting from the bax payment delinquency, to wit: (a) by administrative
action thru distraint of goods and other personal property of whatever
character and by Ievy upon real properties; and (b) by judicial action,
meaning, filing of a collection case in court against the delinquent taxpayer.
With respect to the collection of real property tax, Section 256 of the l,ocal
Covemment Code provides that for the collection of real property tax and
any other tax levied under Title II (Real Property Taxation) of the Local
Govemment Code, the local government unit concemed may avail of the
remedies by administrative action thru levy on real property or hy judicial
action.

At tlais point, it bears to stress that the Local Government Code, as a

means of collecting taxes, fees or charges, did not confer any authority upon
any Local Chief Dxecutive for that matter the power to enter into
compromise agreement with tax clelinquents. But equally important is the
fact that there is also no prohibition. tlence, we believe that if entering into
l compromise agreements is to be resorted to in order to avoid court
t,
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litigdtions, saicl power may be properly provided for in the local tax
ordin^n". itself or in any amendments made thereto' In your case' the
authoritytoenterintocompromiseagreementwithdelinquenttaxpayersis
contained only in a mere Resolution and was not treated as part of the
original tax ordinance or even as an amendment thereto'

There is, hotvever, a variation with respect to compromise agreements

vis-d,vis the rernedy of judicial action to collect local taxes, fees ancl
charges. In availing the remedy of judicial action, the Qovemor may enter
into a compromise agreement once the collection suit has already been filed
in court. But before the Oovemor can enter into the sarne, a Resolution
from the Sanggunian authorizing the Covemor to enter into a compromise
agreement in the judicial action is required as it involves entering into a
contract which, under the l,ocal Oovernment Code, would require prior
authoriw from the sanggunian. The compromise agreement shall then be
submitted to the court for approval which, under the Kules of court, shall
then become the court,s judgment. In this case, there is no need to pass
any . ordinance vesting unto the Covemor the power to enter into
compromise agreements as 'the procedure is part of the remedy of judicial
action availed of Lry the local government unit.

As to your third observation, the "ratification from the

Sangguniang Panlolanaigan" on any compromise entered into by the
covemor based on the Resolution passed by the sangguniang Panlalawigan
cannot cure the procedural and substantive defect that such authority
should be incorporated in the ordinance or in the amendments thereto'

' We hope we have enlightened you on the matter'

Very truly yours,

/l /
Ldz'ot'tt"-' '
AUSTENE A. I'ANADFR,O
tJndersecr etary.
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Lcsal:2o:,L7:43lln
WDirector nobcrto C. Abeiero
cc:
DlLc negional Office No. lV-A
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