Inherent Limitations Of Taxing Power

Question 1

What are the non-delegable legislative powers taxation?

Answer 1

1) ) selection of property to be taxed
2) determination of the purpose for which taxes shall levied be
3)fixing the rateof taxation
4) rules of taxation in general

Question 2

a.If taxation is for a public purpose, the tax
must be used:

Answer 2

a.If taxation is for a public purpose, the tax ‘
must be used:
a.1) for the support of the state or
a.2) for some recognized objects of governments or
a.3) directly to promote the welfare of
the community (taxation as an implement of
police power)

Question 3

Test in determining Public Purposes in tax

Answer 3

a. Duty Test – whether the thing to be threatened by the appropriation of public revenue is something which is the duty of the State, as a government.
b. Promotion of General Welfare Test –
whether the law providing the tax directly
promotes the welfare of the community in equal
measure.

Question 4

Non-delegability of Taxing Power Exceptions

Answer 4

Delegation to the President (Art.VI. Sec. 28(2) 1987 Constitution) The power granted to Congress under this
constitutional provision to authorize the President to fix within specified limits and subject to such limitations and restrictions as it may impose, tariff rates and other duties and imposts include tariffs rates even for revenue purposes only. Customs duties which are assessed at the prescribed tariff rates are very much like taxes which are frequently imposed for both revenue- raising and regulatory purposes (Garcia vs Executive Secretary, et. al., G.R. No. 101273, July 3, 1992)
b. Delegations to the Local Government (Art. X. Sec. 5, 1987 Constitution) It has been held that the general principle
against the delegation of legislative powers as a consequence of the theory of separation of powers is subject to one well-established exception, namely, that legislative power may be delegated to local governments. The theory of non-delegation of legislative powers does not apply in maters of local concern. (Pepsi-Cola Bottling Co. of the Phil, Inc. vs City of Butuan, et . al., L-22814, Aug. 28, 1968)
c. Delegation to Administrative Agencies
with respect to aspects of Taxation not legislative in
character.

Question 5

Territoriality or Situs of Taxation

Answer 5

a.Territoriality or Situs of Taxation means “place of taxation” depending on the nature of taxes being imposed.
b.It is an inherent mandate that taxation shall only be exercised on persons, properties, and excise within the territory of the taxing power because:
b.1) Tax laws do not operate beyond a country’s territorial limit.
b.2) Property which is wholly and exclusively within the jurisdiction of another state receives none of the protection for which a tax is supposed to be compensation.

Question 6

What is international comity

Answer 6

a.The property of a foreign state or government may not be taxed by another. b.The grounds for the above rule are: ‘
b.1) sovereign equality among states
b.2) usage among states that when one
enter into the territory of another, there is an implied understanding that the power does not intend to degrade its dignity by placing itself under the jurisdiction of the latter
b.3) foreign government may not be sued
without its consent so that it is useless to assess the tax since it cannot be collected
b.4) reciprocity among states