SEPTEMBER 6, 2021 All of these projects are to be reported to

the Office of the President for SONA then

FISCAL ADEQUACY consolidated by the department of Budget
for 2022.
The tax for which the legislature will impose
must be sufficient enough to supply or meet 2. Legislative
the demands of the project it intends to a. Congress
fund.

Function Of the government is divided into:

- National Last July the President went to Congress to
- Local report - state of the nation.
- Provincial
- City A report of the president to the congress of
- Municipality what happened, analysis of the country at
- barangay present economically then proposed
amount needed to fund the project.
Ex. If the city road is a project then the local
government will fund it but if it is a national Why?
road, then the national government will fund It is the function of the congress to pass tax
it. law and approve the budget thats why it is
reported to congress. This is General
National High School, State Universities - Appropriations Act - National Government
National Government funded Budget

Pamantasan ng lungsod ng Maynila - Medium Term Plan

funded by city of Manila Pres. Fidel Ramos - Philippine 2000
Pres. Erap - Angat Pinoy
How does the national government Pres. Gloria - Strong republic
operate financially? Pres. Pinoy - Daan Matuwid
1. Executive department Pres. Duterte - Build, Build, Build
a. The departments under the Six year plan
administrative code
b. Department of Finance There should be a key result area,
c. National Economic performance result.
Development Authority
d. Department of Budget - So all projects are submitted to the
department of budget, to be studied by
Ex. Quezon Avenue is a national road NEDA, and the Department of Finance will
funded by the national govt. So if they want submit a projection next year. Neda
to rehabilitate, then the national government consolidated and released the proposed
will fund it. Under the public works, district budget to the president then the press will
engineer. submit the same to the Congress.
Then someone will propose and discuss but
they cannot increase or decrease the
proposed budget.
If they approve the budget, then they will
enact the law.
The people themselves in a democracy can
be a problem especially if they are not well
educated.
Paano papasok politika?
Executive department - executes the
projects
Congress - Approves the projects.
But remember, a congressman is voted by
the people and the congressman must have
a project.
Pork Barrel - congressmen are allocated a
second amount to tell dpwh the breakdown
of budget for the project. Then this is
submitted to the president.
Pork barrel becomes a bonus when the
congress is not in opposition. So there are
districts that are so well built and funds have
nowhere to be put to use na.
Allocation of funds can depend on being
close to the party. So some of the congress
changed party to the president.
Why did pork barrel become bad? - the
fixing of the bidding process.
In theory, it is not inherently bad.
The bidding process is where projects are
fixed so this is where the corruption
happens.
“Niluluto ang bidding process”
Business politics is handled by the Filipino.
Political dynasty on family businesses
Business of commerce is now run by the
chinese.
- BDO
- PNB
- BPI
- AIRLINES
- PAL,
- CEBU PAC.,
- RETAIL BUS.,
Solution is not from the politicians but by
educating the people.
Government is the reflection of what kind of
people we have. Corruption starts from the
people themselves. The government is a
mirror.
Corruption did not start from the
government, it started from us the majority
of the people. So what we need is to elevate
civilization, educate the people.
Absolute power tends to corrupt.
If the congress is corrupt, then who voted
for them? ACCK OK BITCH.
Fiscal Adequacy - this is the projection of
what is spent so there is also projection of
either increasing the tax or less expenses.
Specific funding will project what tax we
need and what complete amount is to be
taxed or either less expenses.
September 27, 2021
EQUAL PROTECTION CLAUSE
If the congress surpasses a law,
GR: applicable to all, make no distinction,
for all citizens and even foreigners
If equal protection guarantees that laws
protect everyone equally, is congress
therefore prohibited from passing a law that
would make a distinction like treating a
certain class or individuals, prohibiting them
from doing something or anything?
Answer:
Shell vs. Vano
The case of Ormoc Sugar Central
If everybody is prohibited from drinking
alcohol? Everyone must be prohibited, not
just certain people
But Supreme Courts said: (exception)
Congress can pass a law that has
classifications provided it is reasonable.
- Distinction as to individuals.
Provided, it is reasonable
When is it reasonable?
When there is substantial distinction
germane to the purpose of the law and it
must be applicable to all members of the
class and applicable to present and future
condition.
The case of Ormoc Sugar Central
- Filed a case questioning a certain
ordinance as it is violative for equal
protection.
The problem is that the ordinance is
specifically applicable to only ormoc sugar
central so it is applicable to present
conditions.
However in the case of Shell, the fact is that
the generic installation manager, provided
the person in charge changes in the future,
he is still subject to the tax and that is under
the future conditions for equal protection.
Uniform and Equitable
Art. V. Section 28 (1).
The rule of taxation shall be uniformed and
equitable. The Congress shall evolve a
progressive system of taxation.
Uniformity means that the tax should be the
same in all over the country where the
subject is found. It should be treated in
similar matters, all similar subjects must be
taxed in a similar manner.
Progressive system of taxation -
encourages congress to create taxes that
increases taxes as the tax base increases
Purpose: equal distribution of wealth.
NON DELEGATION OF
LEGISLATIVE POWER
Rationale of this rule:
- Art. VI, Sec. 1 - legislative power
cannot be delegated because the
constitution is the one that gave the
congress this power.
- GR: What has been
delegated cannot be
redelegated.
- Congress being (a legislative
body) in possession of the
power to legislate cannot
delegate their power except
when the people has allowed
the congress to delegate its
power.
Question: did the people allow congress to
delegate its power somewhere else? YES,
even the constitution but subject to
certain limitations.
Exceptions:
- Congress may authorize president
but fixed within certain limits.
- Tariff rates, import and export
quotas,
- Each local government unit shall
have the power to create its own
power but this is a constitutional
power, not from legislation. Local
government have the power to
create its own sources of revenues,
levy taxes, fees and charges subject
to such guidelines and limitations as
Congress may provide (Art. X, Sec.
5). But the power of the local
government can be subject ot the
congress’s limitations.
NON IMPAIRMENT CLAUSE
GR: No law impairing the obligation of a
contract shall be passed
Impairing means changing the terms of the
contract.
Example: A - Seller, B- Buyer
A is a dealer of minerals while B is a
manufacturer so he bought materials to be
delivered on December 10.
A law was passed later on, in November,
stating that XYZ chemical is prohibited from
being sold to the market and any person
caught with it shall be penalized because
the chemical is used to manufacture illegal
drugs so you cannot sell this drug without
seeking a clearance from PDEA.
The law was passed in November, the
contract was signed in September to be
executed in December.
Did this law which prohibited the selling of
chemical imparied the contract of A and B?
YES.
If yes, Did it not violate the constitutional
limitation on impairment of obligaction of the
contract of parties?
What will happen therefore is that insofar a
and b is concerned, that law is ineffective
because no law shall be passed impairing
the obligation of a contract.
The law violated the constitutional limitation
in relation to the contract of A and B.
Is that argument valid?
The law is quite clear in prohibiting the
selling of the drug. Furthermore, the
constitutional provision on this limitation is
inferior to police power. If the law passed is
in exercise of police power, this provision is
ineffectual so it cannot be the basis to nullify
the law insofar as police power is
concerned. Since it is a chemical used to
make illegal chemicals, then the contract
cannot be implemented because not it is
illegal and if they do they will be subject to
penalty.
So where can this provision be used?
Taxation, because the non impatient claus is
superior in taxation.
So how will it be applied?
Example: A and B - contract of
construction of house
Entered into September 2021, and
implemented starting January 2022, delivery
is December of 2022.
Sometime in november, another law was
passed.
So A and B entered into the contract with
the covenant or agreement that the
contractor tax imposed 5% will be paid by
the contractor. Shouldered by contractor per
contract.
So in november another law was passed
and that is value added tax, no more
contractor’s tax but VAT 10%. So who is
going to pay 10%? The amount will be
added to the contract twice.
Under the contract, the tax is to be paid by
the contractor. So it will not be added to the
price but paid by the contractor to the
government, but collected from the client.
So now we have a problem. No more
contractor’s tax, only VAT to be paid by the
client.
Did this new law, impaired the obligation of
contract between A and B because it is
quite clear that the contractor is the one
going to pay the tax. But no more contractor
tax, it will not be the client paying 10%, did it
affect their obligations in the contract?
Because if it does, that law insofar as these
two are concerned is INVALID. Because the
contract was entered into prior to the
passage of the law.
Is that a valid argument?
YES, it is quite clear from the example that
there was a change in the terms and
condition because there is a terms that the
contractor will pay the 1 million tax but the
ew law means the client will 2 million tax
(the 10% VAT) - this clearly impairs the
contract.
So insofar as these two are concerned, the
law is ineffectual. So they will not be
required to pay the VAT.
Is that a correct argument? NO.
So what was changed here? Not the
relationship between a and b but between a
and the government (b and the
government). Did it impair the obligation? It
looks like it did. What has changed is
between a/b and the government, and since
there is no contract between them there is
no impairment of contract.
This constitutional provision is only
applicable when the contract is entered into
a private entity and public/government
entity.
Example. Tax incentives given to private
entities or private investors, if they employ
1,000 employees and locate yourselves in
the eco zone, the tax will be fixed at 10% to
encourage building factories.
This agreement is a contract, and so the
government cannot later on pass a law
changing the terms and condition of that
contract because it entered into a contract
with a private entity.
The private constitution can use this
provision against laws that change or
impairs its contract with the government.
ORIGIN OF A BILL
The procedural limitation that must be
followed by congress in enactment of tax
law.
One of the procedure requirement is:
FIRST: All appropriation, revenue or tariff
bills, bills authorizing the increase of the
public debt, bills of local application and
private bills shall originate exclusively in the
House of Representatives, but the Senate
may propose or concur with amendments.
Appropriation bill - is not the law that
authorize the release of public fund
Revenue bill - is the law that authorizes the
imposition of taxes. Both powers belong to
congress. How money will be spent will be
determined by the congress into the
enactment of General Appropriation Tax.
Tariff bill - is a tax imposed on
importation/export of goods.
What do we mean by the word originate?
How are bills passed?
In most cases, the law is proposed by the
executive department but this is not always
the case.
The congress consists of the house of
representatives and the senate.
First reading:
Law proposed in first reading, means
someone sponsored from the senate. The
house of representative member will submit
bill to the secretary for the schedule or
reading of the bill.
The proponent of the bill will read only the
title and after that the main plenary will
know if it's a tax law so they will refer it to
that ways and means committee or other
committees that may be involved in hearing.
The committee will conduct a hearing on the
matter. ‘Hearing’ is the time when they will
invite people or resource persons and ask
them about what they can say about the
law. They will conduct a hearing for the
matter and the committee will consider
suggestions of the experts so they would
know whether the proposed law is good.
After healing they will make a report
whether the bill should be archived. They
can vote to archive it or improve it
considering the suggestion of the experts
attending the hearing.
After the hearing they will report the matter
to the plenary. Then if there is a provision
that needs to be amended or changed, that
is the time they will change it and if they see
there is much objection from the people at
the time of the hearing, when so many
people disagree with the bill they can just
kill the law or archive it.
But they can amend it. So they will report
the new bill with recommendation and
submit it to the main plenar wherein the
second reading takes place.
Second reading:
This is the reading of the entire law. -
second reading.
What is important here is that there will be
interpolation of the bill. This is cross
examining the people proposing the law.
Because of that they can discover if the bill
can be revised considering the interpolation.
It is important that the person proposing the
law knows the law. It is a problem if the
person is not well suited to the law.
(in most cases, people who are not well
versed with the law, they give the law to
someone who can make the necessary
advice to answer interpolations).
Third reading:
The third reading is the day when they will
vote on whether they say yes or no.
If yes- the bill is passed in the house and
can go to the senate. Then the senate will
have the same proceeding (first reading,
second reading, third reading). The same
considerations.
Both chambers will have the same
procedures.
If it is passed, it will now have two
versions. Version of the Representatives
and version of the Senate. So the bill must
be identical because if it is not identical then
it is not passed. Period and comma is
important because it might change the
meaning of the law.
It must be identical but how because there
might be revisions from the senate.
The solution is the - bicameral
representative committee. There will be
representatives from the senate and house
of representatives in this committee and
they will meet to iron out the differences.
They will reconcile the version of the senate
and the representatives.
How is this ironed out? In this case, they
must agree right down to the last wording,
comma and period. After this, the law will
return to the senate and representatives
and will undergo another third reading.
Approve what has been approved in the
bicameral committee
This is why it is important why you have a
majority of the people’s vote in the
representative and senate. The identical bill
now becomes an evolved bill from the
house of representatives.
Remember:
- In the event there is a difference in
the version of the bill from senate
and representative, the goal is to
reconcile, iron out the differences.
- This process of ironing the versions
is handled by the Bicameral
Committee that contains
representatives from both chambers.
- It is not a matter of who’s version
wins, both chambers have equal
power.
GR: The bill can originate in either house.
EXCPT: appropriation bill, revenue bill or
tariff bill, bills of local application and private
bills,bills authorizing the increase of public
debt. They must originate from the house of
representatives.
G.R. No. 115455 August 25,1994
The GR and EXCPT stated above is the
argument of Tolentino.
Apparently in the case, the house of
representatives passed an expanded value
added tax and went to senate but the
senate did not consider this bill. Its not the
one discussed, but the senate bill was what
they discussed. What was subjected in the
reading procedures was the version of the
senate, and what was passed to the
bicameral committee was the version not
passed by the house of representatives.

So tolentino argues that the law passed and
signed by the president is void because it
did not undergo the constitutional
procedure. The senate did not consider the
version of the house of representatives.
There were so many grounds to declare the
law unconstitutional.
So How did the sc ruled?
SC ruled:
Originate foes not necessarily mean the
senate needs to consider what came from
the house of representatives. Senate does
not haveto wait from the house of
representatives before passing all
proceedings.
“Indeed, what the Constitution simply
means is that the initiative for filing revenue,
tariff, or tax bills, bills authorizing an
increase of the public debt, private bills and
bills of local application must come from the
House of Representatives on the theory
that, elected as they are from the districts,
the members of the House can be expected
to be more sensitive to the local needs and
problems. On the other hand, the senators,
who are elected at large, are expected to
approach the same problems from the
national perspective. Both views are thereby
made to bear on the enactment of such
laws.”
2. For purposes of making it identical
they can just meet in the bicameral
committee.
So in summary, the interpreted procedure of
the supreme court of the word originates
simply meant that initiative filing of the bill
must come from the house of
representatives.
SECOND: The voting requirement.
Art.VI, Sec. 16(2)
A majority of each House shall constitute a
quorum to do business, but a smaller
number may adjourn from day to day and
may compel the attendance of absent
Members in such manner, and under such
penalties, as such House may provide.
Art VI, Sec. 28(4)
No law granting any tax exemption shall be
passed without the concurrence of a
majority of all the members of Congress.

The consequence of this ruling is that the:

1. The house of representatives
conducted the first reading, it has
filed and initiated the filing of bills.
Once it is read, the senate may now
start to have their first reading also,
if it is vat law, senate can proceed
simultaneously.