Whether the Tax Imposed by the Provincial Government of Laguna on the Business of KARDCO Marketing, Inc. is Proper

September 28, 2001 DILG LEGAL OPINION NO. 071-01 MS. CARMELITA D. RAMOS KARDCO Marketing, Inc. Rm. 1107, 11th Floor Cityland 10 Tower 1, H.V. Dela Costa Street Corner Ayala Avenue, Makati City Dear Ms. Ramos : This refers to your letter requesting for legal opinion on whether or not the tax imposed by the Provincial Government of Laguna on the business of KARDCO Marketing, Inc.,of printing cards thereat is proper. According to you, said corporation has its principal office in Makati City. You stated further that said corporation has some business activities in Laguna, specifically, printing of cards. It is contended that KARDCO Marketing, Inc.,may be required only to pay fee for mayor's permit to the Municipality of Bian where aforesaid business activity is actually conducted. Please be informed that the abovesaid tax imposition appears to be proper. The Provincial Government of Laguna exacted tax on the business activity of said corporation of printing cards pursuant to Section 136 of the Local Government Code (RA 7160) which provides that the province may tax on the business of persons engaged in the printing and/or publication of cards, among others, at a rate not exceeding fifty (50) of one percent (1%) of the gross annual receipts for the preceding fiscal year. It may be worth emphasizing also that a fee is different from a tax. A license fee is a police measure, the amount collected is limited to the cost of permit and reasonable police regulation. While tax is a revenue measure imposed pursuant to law. We hope to have enlightened you on the matter. Very truly yours, (SGD.) JOSE D. LINA, JR. Secretary Department of Interior and Local Government