Bureau of Local Government Finance Opinion

August 8, 1996 BUREAU OF LOCAL GOVERNMENT FINANCE OPINION 4th Indorsement Respectfully returned, thru the Regional Director for Local Government Finance, Region X, Lago Building, Vamenta Boulevard Carmen, Cagayan de Oro City, to the Provincial Treasurer of Agusan del Norte, City of Butuan. This refers to Municipal Ordinance No. 03-96 entitled "AN ORDINANCE IMPOSING HAULING FEE FOR HAULING BOULDERS, SAND AND GRAVEL AND PROVIDING PENALTIES THEREOF",enacted by the Sangguniang Bayan of Cabadbaran, Agusan del Norte, which was forwarded for comment on the legality of said ordinance. llcd Upon perusal of subject ordinance, it was noted that what is imposed under Section 1 thereof is "a Business Permit Fee of P500.00 per annum on (sic) any person or persons, natural or juridical hauling boulders, sand and gravel within the jurisdiction of the municipality of Cabadbaran, Agusan del Norte".The imposition is not a "hauling fee" for hauling boulders and sand and gravel. Accordingly, this Bureau holds the view that the imposition is well within the power of the municipality to levy pursuant to the provisions of Section 186 of the Local Government Code of 1991 (LGC) quoted hereunder: "SEC. 186. Power to Levy Other Taxes , Fees or Charges . Local government units may exercise the power to levy taxes, fees or charges on any base or subject not otherwise specifically enumerated herein or taxes under the provisions of the National Internal Revenue Code, as amended, or other applicable laws: Provided, That the taxes, fees, or charges shall not be unjust, excessive, oppressive, confiscatory or contrary to declared national policy: Provided, further, That the ordinance levying such taxes, fees or charges shall not be enacted without any prior public hearing conducted for the purpose." It also appears that the annual rate of P500.00 is reasonable and will not fall within the prohibitions provided for in the aforequoted Section of the Code. Therefore, on condition that a public hearing was conducted for the purpose prior to the enactment of the Ordinance, the same may be enforced and the fee therein imposed collected by the local treasurer's office. However, it may be advisable for the SB to amend the title of the ordinance accordingly. On the other hand, if the fee imposed was a "hauling fee" for the hauling of boulders and sand and gravel, or any goods for that matter, the same will not be a proper or valid imposition in view of the provisions of Section 133(e) of the Code, quoted below: "Sec. 133. Common Limitation on the Taxing Powers of Local Government Units . Unless otherwise provided herein, the exercise of the taxing powers of provinces, cities, municipalities, and barangays shall not extend to the levy of the following: "xxx xxx xxx" "(e) Taxes, fees and charges and other impositions upon goods carried into or out of, or passing through, the territorial jurisdictions of local government units in the guise of charges for wharfage, tolls for bridges or otherwise, or other taxes, fees or charges in any form whatsoever upon such goods or merchandise." It bears emphasis, however, that the foregoing views are expressed in line with the provisions of Article 287 of the Implementing Rules and Regulations (IRR) implementing the LGC and not a declaration of the legality or constitutionality of the ordinance as the matter falls exclusively within the jurisdiction of the Department of Justice. The Sangguniang Panlalawigan of that province is being furnished a copy hereof under a separate letter of even date, copy enclosed. prLL (SGD.) LORINDA M. CARLOS Executive Director