EN BANC
[G.R. NO. 168056 : September 01, 2005]
ABAKADA GURO PARTY LIST (FORMERLY AASJAS) OFFICERS SAMSON S. ALCANTARA AND ED VINCENT S. ALBANO, Petitioners, v. THE HONORABLE EXECUTIVE SECRETARY EDUARDO ERMITA; HONORABLE SECRETARY OF THE DEPARTMENT OF FINANCE CESAR PURISIMA; AND HONORABLE COMMISSIONER OF INTERNAL REVENUE GUILLERMO PARAYNO, JR., Respondents.
[G.R. NO. 168207]
AQUILINO Q. PIMENTEL, JR., LUISA P. EJERCITO-ESTRADA, JINGGOY E. ESTRADA, PANFILO M. LACSON, ALFREDO S. LIM, JAMBY A.S. MADRIGAL, AND SERGIO R. OSMEÑA III, Petitioners, v. EXECUTIVE SECRETARY EDUARDO R. ERMITA, CESAR V. PURISIMA, SECRETARY OF FINANCE, GUILLERMO L. PARAYNO, JR., COMMISSIONER OF THE BUREAU OF INTERNAL REVENUE, Respondents.
[G.R. NO. 168461]
ASSOCIATION OF PILIPINAS SHELL DEALERS, INC. REPRESENTED BY ITS PRESIDENT, ROSARIO ANTONIO; PETRON DEALERS' ASSOCIATION REPRESENTED BY ITS PRESIDENT, RUTH E. BARBIBI; ASSOCIATION OF CALTEX DEALERS' OF THE PHILIPPINES REPRESENTED BY ITS PRESIDENT, MERCEDITAS A. GARCIA; ROSARIO ANTONIO DOING BUSINESS UNDER THE NAME AND STYLE OF "ANB NORTH SHELL SERVICE STATIONâ€; LOURDES MARTINEZ DOING BUSINESS UNDER THE NAME AND STYLE OF "SHELL GATE - N. DOMINGOâ€; BETHZAIDA TAN DOING BUSINESS UNDER THE NAME AND STYLE OF "ADVANCE SHELL STATIONâ€; REYNALDO P. MONTOYA DOING BUSINESS UNDER THE NAME AND STYLE OF "NEW LAMUAN SHELL SERVICE STATIONâ€; EFREN SOTTO DOING BUSINESS UNDER THE NAME AND STYLE OF "RED FIELD SHELL SERVICE STATIONâ€; DONICA CORPORATION REPRESENTED BY ITS PRESIDENT, DESI TOMACRUZ; RUTH E. MARBIBI DOING BUSINESS UNDER THE NAME AND STYLE OF "R&R PETRON STATIONâ€; PETER M. UNGSON DOING BUSINESS UNDER THE NAME AND STYLE OF "CLASSIC STAR GASOLINE SERVICE STATIONâ€; MARIAN SHEILA A. LEE DOING BUSINESS UNDER THE NAME AND STYLE OF "NTE GASOLINE & SERVICE STATIONâ€; JULIAN CESAR P. POSADAS DOING BUSINESS UNDER THE NAME AND STYLE OF "STARCARGA ENTERPRISESâ€; ADORACION MAÑEBO DOING BUSINESS UNDER THE NAME AND STYLE OF "CMA MOTORISTS CENTERâ€; SUSAN M. ENTRATA DOING BUSINESS UNDER THE NAME AND STYLE OF "LEONA'S GASOLINE STATION AND SERVICE CENTERâ€; CARMELITA BALDONADO DOING BUSINESS UNDER THE NAME AND STYLE OF "FIRST CHOICE SERVICE CENTERâ€; MERCEDITAS A. GARCIA DOING BUSINESS UNDER THE NAME AND STYLE OF "LORPED SERVICE CENTERâ€; RHEAMAR A. RAMOS DOING BUSINESS UNDER THE NAME AND STYLE OF "RJRAM PTT GAS STATIONâ€; MA. ISABEL VIOLAGO DOING BUSINESS UNDER THE NAME AND STYLE OF "VIOLAGO-PTT SERVICE CENTERâ€; MOTORISTS' HEART CORPORATION REPRESENTED BY ITS VICE-PRESIDENT FOR OPERATIONS, JOSELITO F. FLORDELIZA; MOTORISTS' HARVARD CORPORATION REPRESENTED BY ITS VICE-PRESIDENT FOR OPERATIONS, JOSELITO F. FLORDELIZA; MOTORISTS' HERITAGE CORPORATION REPRESENTED BY ITS VICE-PRESIDENT FOR OPERATIONS, JOSELITO F. FLORDELIZA; PHILIPPINE STANDARD OIL CORPORATION REPRESENTED BY ITS VICE-PRESIDENT FOR OPERATIONS, JOSELITO F. FLORDELIZA; ROMEO MANUEL DOING BUSINESS UNDER THE NAME AND STYLE OF "ROMMAN GASOLINE STATIONâ€; ANTHONY ALBERT CRUZ III DOING BUSINESS UNDER THE NAME AND STYLE OF "TRUE SERVICE STATIONâ€, Petitioners, v. CESAR V. PURISIMA, IN HIS CAPACITY AS SECRETARY OF THE DEPARTMENT OF FINANCE AND GUILLERMO L. PARAYNO, JR., IN HIS CAPACITY AS COMMISSIONER OF INTERNAL REVENUE, Respondents.
[G.R. NO. 168463]
FRANCIS JOSEPH G. ESCUDERO, VINCENT CRISOLOGO, EMMANUEL JOEL J. VILLANUEVA, RODOLFO G. PLAZA, DARLENE ANTONINO-CUSTODIO, OSCAR G. MALAPITAN, BENJAMIN C. AGARAO, JR. JUAN EDGARDO M. ANGARA, JUSTIN MARC SB. CHIPECO, FLORENCIO G. NOEL, MUJIV S. HATAMAN, RENATO B. MAGTUBO, JOSEPH A. SANTIAGO, TEOFISTO DL. GUINGONA III, RUY ELIAS C. LOPEZ, RODOLFO Q. AGBAYANI AND TEODORO A. CASIÑO, Petitioners, v. CESAR V. PURISIMA, IN HIS CAPACITY AS SECRETARY OF FINANCE, GUILLERMO L. PARAYNO, JR., IN HIS CAPACITY AS COMMISSIONER OF INTERNAL REVENUE, AND EDUARDO R. ERMITA, IN HIS CAPACITY AS EXECUTIVE SECRETARY, Respondents.
[G.R. NO. 168730]
BATAAN GOVERNOR ENRIQUE T. GARCIA, JR., Petitioner, v. HON. EDUARDO R. ERMITA, IN HIS CAPACITY AS THE EXECUTIVE SECRETARY; HON. MARGARITO TEVES, IN HIS CAPACITY AS SECRETARY OF FINANCE; HON. JOSE MARIO BUNAG, IN HIS CAPACITY AS THE OIC COMMISSIONER OF THE BUREAU OF INTERNAL REVENUE; AND HON. ALEXANDER AREVALO, IN HIS CAPACITY AS THE OIC COMMISSIONER OF THE BUREAU OF CUSTOMS, Respondents.
SANDOVAL - GUTIERREZ, J.:
. . . That the President, upon the recommendation of the Secretary of Finance, shall, effective January 1, 2006, raise the rate of value-added tax to twelve percent (12%) after any of the following conditions has been satisfied:This proviso on the authority of the President is uniformly appended to Sections 4, 5 and 6 of R.A. No. 9337, provisions amending Sections 106, 107 and 108 of the NIRC, respectively. Section 4 imposes a 10% VAT on sales of goods and properties, Section 5 imposes a 10% VAT on importation of goods, and Section 6 imposes a 10% VAT on sale of services and use or lease of properties.
(i) Value-added tax collection as a percentage of Gross Domestic Product (GDP) of the previous year exceeds two and four-fifth percent (2 4/5%); or(ii) National government deficit as a percentage of GDP of the previous year exceeds one and one-half percent (1 ½%).
"One of the settled maxims in constitutional law is, that the power conferred upon the legislature to make laws cannot be delegated by that department to any other body or authority. Where the sovereign power of the state has located the authority, there it must remain; and by the constitutional agency alone the laws must be made until the Constitution itself is changed. The power to whose judgment, wisdom, and patriotism this high prerogative has been entrusted cannot relieve itself of the responsibility by choosing other agencies upon which the power shall be devolved, nor can it substitute the judgment, wisdom, and patriotism of any other body for those to which alone the people have seen fit to confide this sovereign trust."9Of course, the rule which forbids the delegation of the power of taxation is not absolute and inflexible. It admits of exceptions. Retired Justice Jose C. Vitug enumerated such exceptions, to wit: (1) delegations to local governments (to be exercised by the local legislative bodies thereof) or political subdivisions; (2) delegations allowed by the Constitution; and (3) delegations relating merely to administrative implementation that may call for some degree of discretionary powers under a set of sufficient standards expressed by law.10
The Congress may, by law, authorize the President to fix within specified limits, and subject to such limitations and restrictions as it may impose, tariff rates, import and export quotas, tonnage and wharfage dues, and other duties or imposts within the framework of the national development program of the Government.Noteworthy is the absence of tax rates or VAT rates in the enumeration. If the intention of the Framers of the Constitution is to permit the delegation of the power to fix tax rates or VAT rates to the President, such could have been easily achieved by the mere inclusion of the term "tax rates" or "VAT rates" in the enumeration. It is a dictum in statutory construction that what is expressed puts an end to what is implied. Expressium facit cessare tacitum.11 This is a derivative of the more familiar maxim express mention is implied exclusion or expressio unius est exclusio alterius. Considering that Section 28 (2), Article VI expressly speaks only of "tariff rates,12 import13 and export quotas,14 tonnage15 and wharfage dues16 and other duties and imposts,17" by no stretch of imagination can this enumeration be extended to include the VAT.
Why authorize the President to increase the VAT rate on the premise alone that she deserves an "incentive" or "reward� Indeed, why should she be rewarded for performing a duty reposed upon her by law?
Senator Lacson. Thank you, Mr. President. Now, I will go back to my original question, my first question. Who are we threatening to punish on the imposed condition No. 1 - the public or the President?Senator Recto That is not a punishment, that is supposed to be a reward system.Senator Lacson. Yes, an incentive. So we are offering an incentive to the Chief Executive.Senator Recto. That is right.Senator Lacson – in order for her to be able to raise the VAT to 12 %.Senator Recto. That is right. That is the intention, yes. x x x x x xSenator Osmena. All right. Therefore, with the lifting of exemptions it stands to reason that Value-added tax collections as a percentage of GDP will be much higher than… Now, if it is higher than 2.5%, in other words, because they collected more, we will allow them to even tax more. Is that the meaning of this particular phrase?Senator Recto. Yes, Mr. President, that is why it is as low as 2.8%. It is like if a person has a son and his son asks him for an allowance, I do not think that he would immediately give his son an increase in allowance unless he tells his son, You better improve your grades and I will give you an allowance. That is the analogy of this. x x x x x xSenator Osmena. So the gentleman is telling the President, If you collect more than 138 billion, I will give you additional powers to tax the people.Senator Recto. x x x We are saying, kung mataas and grade mo, dadagdagan ko an allowance mo. Katulad ng sinabi natin ditto. What we are saying here is you prove to me that you can collect it, then we will increase your rate, you can raise your rate. It is an incentive.21
SEC. 24. All appropriations, revenue or tariff bills, bills authorizing 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.In Tolentino vs. Secretary of Finance,23 this Court expounded on the foregoing provision by holding that:
"x x x To begin with, it is not the law - but the revenue bill - which is required by the Constitution to ‘originate exclusively in the House of Representatives. It is important to emphasize this, because a bill originating the in the House may undergo such extensive changes in the Senate that the result may be a rewriting of the whole x x x. At this point, what is important to note is that, as a result of the Senate action, a distinct bill may be produced. To insist that a revenue statute -- and not only the bill which initiated the legislative process culminating in the enactment of the law - must substantially be the same as the House Bill would be to deny the Senate's power not only to ‘concur with amendments: but also to ‘propose amendments.' It would be to violate the co-equality of the legislative power of the two houses of Congress and in fact, make the House superior to the Senate."The case at bar gives us an opportunity to take a second hard look at the efficacy of the foregoing jurisprudence.
"All bills for raising revenue shall originate in the House of Representatives, but the Senate may propose or concur with amendments, as on other bills."The American people, in entrusting what James Madison termed "the power of the purse" to their elected representatives, drew inspiration from the British practice and experience with the House of Commons. As one commentator puts it:
"They knew the inestimable value of the House of Commons, as a component branch of the British parliament; and they believed that it had at all times furnished the best security against the oppression of the crown and the aristocracy. While the power of taxation, of revenue, and of supplies remained in the hands of a popular branch, it was difficult for usurpation to exist for any length of time without check, and prerogative must yield of that necessity which controlled at once the sword and the purse."But while the fundamental principle underlying the vesting of the power to propose revenue bills solely in the House of Representatives is present in both the Philippines and US Constitutions, stress must be laid on the differences between the two quoted provisions. For one, the word "exclusively" appearing in Section 24, Article VI of our Constitution is nowhere to be found in Section 7 (1), Article I of the US Constitution. For another, the phrase "as on other bills," present in the same provision of the US Constitution, is not written in our Constitution.
Endnotes:
1 Book V of The Wealth of Nations.
2 ABAKADA GURO Party List (Formerly AASJAS), Officers Samson S. Alcantara and Ed Vincent S. Albano.
3 Aquilino Q. Pimentel, Jr., Luisa P. Ejercito-Estrada, Jinggoy E. Estrada, Panfilo M. Lacson, Alfredo S. Lim, Jamby A.S. Madrigal and Sergio R. Osmena III.
4 Francis Joseph G. Escudero, Vincent Crisologo, Emmanuel Joel J. Villanueva, Rodolfo G. Plaza, Darlene Antonino-Custodio, Oscar G. Malapitan, Benjamin C. Agarao, Jr., Juan Edgardo M. Angara, Justin Marc SB. Chipeco, Florencio G. Noel, Mujiv S. Hataman, Renato B. Magtubo, Joseph A. Santiago, Teofisto DL. Guingona III, Ruy Elias C. Lopez, Rodolfo Q. Agbayani and Teodoro A. Casino.
5Luzon Stevedoring Co. vs. Court of Tax Appeals, L-302332, July 29, 1998, 163 SCRA 647 cited in Vitug, Acosta, Tax Law and Jurisprudence, Second Edition, at 7.
6Pepsi Cola Bottling Company of the Philippines vs. Municipality of Tanauan, Leyte, G.R. No. L-31156, February 27, 1976, 69 SCRA 460. See also National Power Corporation vs. Albay, G.R. No. 87479, June 4, 1990, 186 SCRA 198.
7 Bernas, SJ, The 1987 Constitution of the Republic of the Philippines, A Commentary, 1996 Edition, at 687.
8People vs. Vera, 65 Phil. 56 (1937).
9 Cooley on Constitutional Limitations, 8th ed., Vol. I, p. 224.
10 Vitug, Acosta, Tax Law and Jurisprudence, Second Edition, at 8-9.
11Espiritu vs. Cipriano, G.R. No. 32743, February 15, 1974, 55 SCRA 533, 538, citing Sutherlands Statutory Construction, Vol. 2, Section 4945, p. 412.
12 A tariff is a list or schedule of articles on which a duty is imposed upon their importation, with the rates at which they are severally taxed, it is also the custom or duty payable on such articles. (Black's Law Dictionary [6th Edition], 1990, at 1456).
13 An import quota is a quantitative restriction on the importation of an article into a country, and is a remedy available to the executive department upon its determination that an imported article threatens serious injury to a domestic industry. (Id. at 755).
14 An export quota is an amount of specific goods which may be exported and are set by the government for purposes of national defense, economic stability and price support. (Id. at 579).
15 Tonnage dues are duties laid upon vessels according to their tonnage or cubical capacity. (Id. at 1488).
16 Wharfage dues are generally understood to be the fees paid for landing goods upon or loading them from a wharf. It is a charge for the use of the wharf and may be treated either as rent or compensation. (Marine Lighterage Corp. vs. Luckenbach S.S. Co., 119 Misc. 612, 248 NYS 71).
17 A duty is generally understood to be a tax on the importation or exportation of goods, merchandise and other commodities, while imposts are duties or impositions levied for various reasons. (Crew Levick Co. vs. Commonwealth of Pennsylvania, 245 US 292, 62 L. Ed. 295, 38 S. Ct. 126).
18People vs. Vera, supra.
19Walter E. Olsen & Co. vs. Aldanese and Trinidad (1922), 43 Phil., 259; 12 C. J., p. 786.
20 Cruz, Constitutional Law, 1987 Edition, at 101.
21 TSN, May 10, 2005, Annex ‘E" of the Petition in G.R. No. 168056.
22 Vitug, Acosta, Tax Law and Jurisprudence, Second Edition, at 3.
23 G.R. No. 115455, August 25, 1994, 235 SCRA 630.
24 Merriam-Webster's Third New International Dictionary (1993 Ed.), at 793.
25Id.
26City Mayor vs. The Chief of Philippine Constabulary, G.R. No. 20346, October 31, 1967, 21 SCRA 665, 673.
27 Merriam-Webster's Third New International Dictionary (1993 Ed.), at 1592.
28 Davies, Legislative Law and Process, (2d. Ed. 1986), at 89.
29 Entitled "An Act Restructuring the Value-Added Tax, Amending for the Purpose Sections 106, 107, 108, 110 and 114 of the National Internal Revenue Code of 1997, As amended, and For Other Purposes." Approved on January 27, 2005.
30 Entitled "An Act Amending Sections 106, 107, 108, 109, 110 and 111 of the National Internal Revenue Code of 1997, As Amended, and For Other Purposes." Approved on February 28, 2005.
31 Entitled "An Act Amending Sections 27, 28, 34, 106,108, 109,110, 112, 113, 114, 116, 117, 119, 121, 125, 148, 151, 236, 237 and 288 of the National Internal Revenue Code of 1997, As Amended, and For Other Purposes." Approved on April1 3, 2005.
32 Merriam-Webster's Third New International Dictionary (1993 Ed.), at 484.
33Supra.