Case Title

MACTAN CEBU INTERNATIONAL AIRPORT AUTHORITY, petitioner, vs.

FERDINAND J. MARCOS, respondents.

GR no. 120082
Date of September 11, 1996
Promulgation
Ponente
DAVIDE, JR., J.

Facts
Under its charter, the MCIAA shall be exempt from
realty taxes imposed by the National Government or
any of its political subdivisions, agencies and
instrumentalities. In 1994, the Local Government Unit
(LGU) of Cebu City demanded payment for realty taxes
on several parcels of land belonging to MCIAA.

MCIAA objected to the same as baseless and unjustified,

claiming its exemption under its charter. Also, it cites
the LGC stating that LGUs taxing power does not extend
to taxes, fees or charges of any kind on the National
Government, its agencies and instrumentalities, and
local government units.

Cebu City countered, however, citing Sections 193 and

234 of the LGC which withdrew tax exemptions of
GOCCs and realty tax exemptions previously granted to
ore presently enjoyed by all persons, whether natural or
juridical, including GOCCs.

MCIAA paid tax under protest. It insisted that the taxing

powers of LGUs do not extend to the levy of taxes or fees of
any kind on an instrumentality of the national government.
It also insisted that while it is indeed a GOCC, it
nonetheless stands on the same footing as an agency or
instrumentality of the national government by the very
nature of its powers and functions.

RTC’s Decision Petition dismissed.

RA 7160 expressly provides that "All general and special

laws, acts, city charters, decress [sic], executive orders,
proclamations and administrative regulations, or part or
 parts thereof which are inconsistent with any of the
provisions of this Code are hereby repealed or modified
accordingly."

The tax exemption provided for in RA 6958 creating

petitioner had been expressly repealed by the provisions
of the New Local Government Code of 1991.

A motion for reconsideration was denied by the trial

court in its 4 May 1995 order.

Issues [1] WON MCIAA is a taxable person?

[2] WON MCIAA is exempt from realty taxation?

Ratio
Decidendi [1] Although it previously enjoyed exemption from
realty tax under its charter (which has already been
withdrawn by the LGC), this exemption extended only to
said tax, not to other taxes. Hence, MCIAA is still a
taxable person.

[2] MCIAA is not exempt from realty tax. First, its tax
exemption under its charter has already been
withdrawn. Second, while it is true that LGUs cannot
levy tax on property of the Republic of the Philippines or
the National Government (outside Metro Manila), the
beneficial use of property should not be given to a
taxable person.

Held [1] Yes, MCIAA is a taxable person.

[2] No, MCIAA is not exempt from realty tax by the City
of Cebu.