Villegas vs Hiu Chiong Tsai Pao Ho

[G.R. No. L-29646]

Facts:
Ordinance No. 6537 was passed by the Municipal Board of Manila on February
22, 1968 and signed by the herein petitioner Mayor Antonio J. Villegas. Section 1 of
said Ordinance No. 6537 prohibits aliens from being employed or to engage or
participate in any position or occupation or business enumerated therein, whether
permanent, temporary or casual, without first securing an employment permit from the
Mayor of Manila and paying the permit fee of P50.00 except persons employed in the
diplomatic or consular missions of foreign countries.
Private respondent Hiu Chiong Tsai Pao Ho who was employed in Manila, filed
a petition with the CFI of Manila, praying for the issuance of the writ of preliminary
injunction and restraining order to stop the enforcement of Ordinance No. 6537 as well
as for a judgment declaring said Ordinance No. 6537 null and void.
Respondent Judge Arca rendered judgment declaring Ordinance No. 6537 null
and void and making permanent the writ of preliminary injunction.
Issue:
Whether or not Ordinance No. 6537 violated the equal protection clause of the
constitution.
Held
Yes.
Ratio:
The P50.00 fee is unreasonable not only because it is excessive but because it
fails to consider valid substantial differences in situation among individual aliens
who are required to pay it. Although the equal protection clause of the Constitution
does not forbid classification, it is imperative that the classification should be based on
real and substantial differences having a reasonable relation to the subject of the
particular legislation. The same amount of P50.00 is being collected from every
employed alien whether he is casual or permanent, part time or full time or whether he
is a lowly employee or a highly paid executive.
The shelter of protection under the due process and equal protection clause is
given to all persons, both aliens and citizens.
G.R. No. L-49336 – 107 SCRA 104 – Political Law – Powers of the State – Power
of Taxation – Church’s Exemption From Taxes

The Province of Abra sought to tax the properties of the Roman Catholic
Bishop, Inc. of Bangued. Judge Harold Hernando dismissed the petition of
Abra without hearing its side. Hernando ruled that there “is no question
that the real properties sought to be taxed by the Province of Abra are
properties of the respondent Roman Catholic Bishop of Bangued, Inc.”
Likewise, “there is no dispute that the properties including their produce
are actually, directly and exclusively used by the Roman Catholic Bishop of
Bangued, Inc. for religious or charitable purposes.”

ISSUE: Whether or not the properties of the church (in this case) is exempt
from taxes.

HELD: No, they are not tax exempt. It is true that the Constitution
provides that “charitable institutions, mosques, and non-profit
cemeteries” are required that for the exemption of “lands, buildings, and
improvements,” they should not only be “exclusively” but also “actually”
and “directly” used for religious or charitable purposes. The exemption
from taxation is not favored and is never presumed, so that if granted it
must be strictly construed against the taxpayer. However, in this case,
there is no showing that the said properties are actually and directly used
for religious or charitable uses.

Sugar Central vs City Treasurer

Facts: The Municipal Board of Ormoc City passedOrdinance No. 4, Series of 1964,
imposing “on any and all productions of centrifugal sugar milled at the Ormoc Sugar
Company, Inc., in Ormoc City a municipal tax equivalent to 1% per export sale to the
United States of America and other foreign countries.” Payments for said tax were
made, under protest, by Ormoc Sugar Company, Inc. on March 20, 1964 for P7,087.50
and on April 20, 1964 for P5,000, or a total of P12,087.50. Ormoc Sugar Company, Inc.
filed a complain tagainst the City of Ormoc as well as its Treasurer, Municipal Board
and Mayor, alleging that the ordinance is unconstitutional for being violative of the equal
protection clause. On the other hand, the defendants asserted that the tax ordinance
was within defendant city’s power to enact under the Local Autonomy Act and that the
same did not violate the afore-cited constitutional limitations.
Issue: WON the ordinance is unconstitutional for being violative of equal protection
clause.
Held: Yes, the ordinance is unconstitutional for being violative of equal protection
clause. The equal protection clause applies only to persons or things identically situated
and does not bar a reasonable classification of the subject of legislation, and a
classification is reasonable where (1) it is based on substantial distinctions which make
real differences; (2) these are germane to the purpose of the law; (3) the classification
applies not only to present conditions but also to future conditions which are
substantially identical to those of the present; (4) the classification applies only to those
who belong to the same class. The questioned ordinance does not meet the requisites
for a reasonable classification. The ordinace taxes only centrifugal sugar produced and
exported by the Ormoc Sugar Company, Inc. and none other. At the time of the taxing
ordinance’s enactment, Ormoc Sugar Company, Inc., it is true, was the only sugar
central in the city of Ormoc. To be reasonable, it should be applicable to future
conditions as well. The taxing ordinance should not be singular and exclusive as to
exclude any subsequently established sugar central, of the same class as plaintiff, for
the coverage of the tax. As it is now, even if later a similar company is set up, it cannot
be subject to the tax because the ordinance expressly points only to Ormoc City Sugar
Company, Inc. as the entity to be levied upon.

DOCTRINES:
The Constitution does not require absolute equality among residents. It is enough that
all persons under like circumstances or conditions are given the same privileges and
required to follow the same obligations.
The classification based on a valid and reasonable standard does not violate the equal
protection clause.
FACTS:

RA 7227 seeks to accelerate the conversion of military reservations into other

productive uses. Section 12 thereof created the Subic Special Economic Zone (SSEZ),
which includes the City of Olongapo, Municipality of Subic and the lands occupied by
the Subic Naval Base and granted special privileges.
Thereafter, EO 97 was issued to clarify the application of the incentives provided by RA
7227. Sec. 1 of EO 97 provides for the tax and duty-free importations shall only be
applied raw materials, capital goods and equipment brought in by business enterprises
into the SSEZ. Except for these items, importations of other goods into the SSEZ,
whether by business enterprises, resident individuals are subject to the taxes and duties
under Philippine laws. The exportation or removal of tax and duty free goods from the
territory of the SSEZ to other parts of the Philippines shall be subject to duties and taxes
under Philippine laws.
Section 1.1 thereof grants the enjoyment of the tax and duty incentives to the business
and enterprises and residents within the presently fenced-in former Subic Naval Base
only. It excludes the the first two component cities as provided for by Sec. 12 of RA
7227.
ISSUES:
Whether EO 97-A violates the equal protection of the laws?

RULING:
No, EO 97-A is not violative of the equal protection of the laws.
The fundamental right of equal protection of the laws is not absolute, but is subject to
reasonable classification.
Classification, to be valid, must (1) rest on substantial distinctions, (2) be germane to
the purpose of the law, (3) not be limited to existing conditions only, and (4) apply
equally to all members of the same class.
RA 7227 aims primarily to accelerate the conversion of military reservations into
productive uses.
The Government provides enticements as to persuade and attract investors to pour in
capital with the said military bases. Among such enticements are: (1) a separate
customs territory within the zone, (2) tax-and-duty-free importations, (3) restructured
income tax rates on business enterprises within the zone, (4) no foreign exchange
control, (5) liberalized regulations on banking and finance, and (6) the grant of resident
status to certain investors and of working visas to certain foreign executives and
workers.
The purpose of the law is to convert former military base to productive use for the
benefit of the Philippine economy. Hence, there was no reasonable basis to extend the
tax incentives in RA 7227.