DOJ Opinion No. 029, s. 1992

DOJ OPINION NO. 029 , s. 1992 March 9, 1992 Mr. Jesus F. Celdran President Beverage Industry Association of the Philippines 7th Flr.,Felisa Bldg. 108 Herrera St.,Legaspi Village Makati, Metro Manila Sir : This has reference to your letter-appeal dated January 19, 1992 protesting the enactment of Ordinance No. 3057, entitled "The Cagayan de Oro Tax Code of 1992", by the Sangguniang Panlungsod of Cagayan de Oro on December 20, 1991 and which took effect on January 1, 1992. LLpr Your protest is anchored on the ground that the enactment of the subject Ordinance did not satisfy the procedural requirement of a public hearing as provided for in Section 186 of R.A. No. 7160, otherwise known as the Local Government Code of 1991, which reads: "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. ...Provided, further that the ordinance levying such taxes, fees or charges shall be not enacted without any prior public hearing conducted for the purpose." Quoted hereunder the pertinent provisions of the Local Tax code, the law in force at the time of the enactment of the Ordinance in question: "Sec. 44. Review and Suspension of Tax Ordinance . . . . The Secretary of Finance, the provincial treasurer or the city treasurer, as the case may be shall review and have the authority to suspend the effectivity of any tax ordinance within one hundred and twenty days after receipt of a copy thereof, if, in his opinion, the tax or fee therein levied or imposed is unjust, excessive, oppressive, confiscatory, or not among those that the particular local government may impose in the exercise of its power in accordance with this Code; or when the tax ordinance is, in whole or in part, contrary to declared national economic policy; when the ordinance is discriminatory in nature on the conduct of business or calling or in restraint of trade." "Sec. 45. Formal Protest Against a Tax Ordinance . A formal protest based on grounds provided in the preceding section may be filed with the Secretary of Finance within one hundred and twenty days after the approval of the tax ordinance of any local government, or after the date of the initial implementation thereof, and the Secretary shall have sixty days, after receipt of the protest, to decide the same . . ." "Sec. 47. Question on the Legality of a Tax Ordinance . Any question or issue raised against the legality of any tax ordinance, or portion thereof, on grounds other than those mentioned in Section 44 of this Code, shall be referred for opinion of the Provincial Fiscal (Prosecutor) in the case of provincial, municipal and barrio tax ordinances or to the City Fiscal (now Prosecutor) in the case of the tax ordinances of the city and barrios within the city . . . The opinion of the provincial or City Fiscal (Prosecutor) . . . shall be appealable to the Secretary of Justice . . .". It is clear from the aforequoted provisions that the Secretary of Justice may pass upon questions or issues raised against the legality of tax ordinances only upon appeal from the Provincial or City Fiscals' (now Provincial/City Prosecutor) opinions, and on grounds other than those mentioned in Section. 44, abovecited (Sec. of Justice Op. No. 57, s. 1977).Accordingly, the matter should be referred first to the City Prosecutor of Cagayan de Oro City, and it is only after he has rendered his opinion thereon can the same be filed with this Department. While it is true that under Section 187 of Local Government Code of 1991 (R.A. No. 7160, effective January 1, 1992), "any question on the constitutionality or legality of tax ordinances or revenue measures may be raised on appeal within thirty (30) days from the effectivity thereof to the Secretary of Justice who shall render a decision within sixty (60) days from the date of the receipt of the appeal; . . ., this new protest procedure however is applicable only to ordinances enacted after the effectivity of the said provision in accordance with the rule in this jurisdiction that laws should be considered as prospective in its operation unless the language of the law clearly demands or expresses that it shall have a retroactive effect. (Secretary of Justice Op. No. 17, s. 1992). prcd We may add that since the subject Ordinance was enacted prior to the effectivity of the Local Government Code of 1991, there is no provision in the repealed Local Tax Code (P.D. No. 231, as amended) which requires public hearing before enactment of a tax ordinance. prLL Very truly yours, (SGD.) EDUARDO G. MONTENEGRO Acting Secretary