DOJ Opinion No. 073, s. 1984

DOJ OPINION NO. 073 , s. 1984 April 17, 1984 The Acting City Fiscal Marawi City Sir : This refers to your request for "Legal Opinion" as to whether or not the National Power Corporation (NAPOCOR) may claim exemption from payment of real property tax imposed under the Real Property Tax Code (P.D. No. 464) by virtue of its tax-exemption privilege under its Charter (R.A. No. 6395) You state that the City Government of Marawi City is "assessing and imposing" a real property tax upon the NAPOCOR for its hydroelectric plant in said area pursuant to the provisions of P.D. No. 464 and Section 23 of P.D. No. 1177 ("Budget Reform Decree of 1977"). You also state that notwithstanding the adverse opinion of the General Counsel of NAPOCOR, its President, Mr. Gabriel Y. Itchon maintains that under its revised Charter, the corporation is exempt from payment of the said tax. At the outset, we would like to advise you that pursuant to settled precedents, the Minister of Justice does not render opinion on queries posed by fiscals in connection with the performance of their duties as legal advisers of the province or city and its officials, as the case may be (Ops., Sec. of Justice, No. 56, s. 1974; No. 59, s. 1973; No. 191, and 24, s. 1971). Nonetheless, for your information and guidance, we wish to invite attention to a recent opinion of this Ministry (Op. No. 30, current series, copy enclosed) wherein we ruled that the NAPOCOR may claim exemption from payment of locational clearance fees which are not taxes, but fees for services rendered . In said Opinion, this Ministry opined that the broad exemption privilege of the NAPOCOR under Section 13 of R.A. No. 6395, as amended by Section 10 of P.D. No. 938 is deemed modified by Section 23 of P.D. No. 1177 insofar as the latter " may have withdrawn the tax and duty exemption of the NAPOCOR under revenue laws" . The term "revenue laws" refers to such laws as are made for the direct and a vowed purpose of creating and securing revenues or public funds for the services of the Government. It refers to any law which provides for the assessment and collection of tax to defray the expenses of the government (Op. No. 30, c.s. citing American jurisprudence). Your attention is likewise invited to the earlier opinions of this Ministry ruling upon the effect of Section 23 of P.D. No. 1177 on the tax exemption privileges of government-owned or controlled corporations granted in their respective charters. The pertinent rulings are hereunder quoted as follows: Opinion No . 133, s . 1977 ". . . section 23, supra , has the effect of withdrawing from government-owned or controlled corporations the tax exemptions granted in their respective charters. For I see this provision as a clear and unequivocal expression of the legislative intent to subject all units of government including government-owned or controlled corporations to the payment of all taxes, duties and fees imposed under revenue laws. Therefore, the charter of any government corporation which provides for the exemption of the particular corporation from any tax, duty or fee should to the extent of the imposition of the exemption be deemed repealed by P.D. No 1177. This is in consonance with the rule that prior special laws (the tax exemption provision in the charter) may be repealed by implication upon the enactment of a later general statute (P.D. No. 1177) where the legislative intent to effectuate a repeal is unequivocally expressed (Sutherland, Statutes and Statutory Construction , Vol. I, p. 487)." LexLib Opinion No . 98, s . 1979 "I wish to reiterate the observation in subject Opinion [Op. No. 133, s. 1977] that P.D. No. 1177 'is aimed at the institutionalization budgetary innovations of the New Society', and is 'designed to regulate the national budgetary process', as shown by the preambulatory clauses of said decree. . . . We find no cogent reason for changing the view expressed in subject Opinion that in the implementation of Section 23 of P.D. No. 1177 no distinction should be make between government corporations which were already enjoying the tax exemption privileges at the time said decree took effect and those to which such exemption were granted later, if the above-stated purposes would not be realized but on the contrary would be defeated by an interpretation that would limit the operation of the decree, insofar as government corporations are concerned, to those belonging to the first group." Opinion No . 1, s . 1980 "Subject to the extended discussion hereunder, we are of the opinion that both of the tax exemption privileges granted to MWSS in the two cited provisions of its Charter, R.A. No. 6234, as amended, have in effect been withdrawn by virtue of section 23 of P.D. No. 1177, as the latter is a statute of later enactment which unequivocally and clearly subject all units of government including government corporations to all taxes/duties/fees imposed under revenue laws and therefore the MWSS charter, to the extent of the grant of the exemptions, be deemed repealed by P.D. No. 1177. However, MWSS may, pursuant to the first provision of section 23, supra , ask for a subsidy from the General Fund in the exact amount of the taxes/duties it would have to pay as a result of the withdrawal of the exemptions." LLphil It may be pointed out also that Section 4 of P.D. No 1360, amending Section 8 of the NAPOCOR Charter, refers to exemption from payment of taxes on bonds issued by the NAPOCOR in connection with domestic loans or indebtedness. We trust that with all the foregoing, you will be guided accordingly. Very truly yours, (SGD.) JESUS N. BORROMEO Deputy Minister