DOJ Opinion No. 181, s. 1984

DOJ OPINION NO. 181 , s. 1984 December 17, 1984 Minister Salvador H. Escudero III Ministry of Agriculture and Food Diliman, Quezon City Sir : This refers to your request for legal opinion on the legality of Ordinance No. 7 dated August 22, 1983 of the Sangguniang Bayan of Bongabong, Oriental Mindoro imposing a fee for every head of hog, cattle and goat transported to other places. In this connection, you have furnished us with a copy of the 2nd Indorsement dated December 1, 1983 of the Bureau of Animal Industry to the Minister of Agriculture which states that the exercise of the power of a municipal government to pass ordinance creating sources of revenue pursuant to Section 8 of Batas Pambansa Blg. 337, otherwise known as the Local Government Code, may not contravene any statute nor be inconsistent with public policy. The said communication expresses the observation that the subject ordinance is unfair to livestock owners, contravenes an existing statute placing in your Ministry, through your Regional Offices, the authority to inspect and regulate the transport of livestock and collect fees therefor, and runs counter to the policy of the government to encourage livestock raising. Under Section 44 of the Local Tax Code, the authority to review and suspend a tax ordinance, within 120 days from receipts of a copy thereof, is vested upon the Minister of Finance or the provincial city treasurer in cases where the tax or fee levied therein is, in his opinion, unjust, excessive, oppressive, confiscatory or is not among those that the particular local/government may impose in the exercise of its power in accordance with the Local Tax Code, or when the tax ordinance is in whole or in part contrary to declared national economic policy or discriminatory in nature on the conduct of business or calling or in restraint of trade. A formal protest based on the same grounds may also be filed with the Minister of Finance within 120 days after the approval of the tax ordinance of any local government or after the date of initial implementation thereof (Sec. 45, Local Tax Code). Any legal question or issue raised against a tax ordinance or a portion thereof on grounds other that those mentioned above is referred for opinion to the Provincial Fiscal in the case of provincial, municipal and barrio tax ordinances, or to the City Fiscal in case of tax ordinances of the city or the barrios within the city. The opinion of the Provincial or City Fiscal is applicable to the Minister of Justice. prcd The issues which you raise against the legality of the subject tax ordinance are among those which the Minister of Finance has the competence to resolve under the Local Tax Code. Even the question of whether or not the tax ordinance infringes upon the authority vested by law upon the Minister of Agriculture to inspect and regulate the transport of livestock and collect fees therefor is cognizable by the Minister of Finance as said question could be resolved by defining the proper scope of the taxing authority vested upon the municipality under the Local Tax Code in relation to the aforestated authority of the Minister of Agriculture. dctai In view thereof, the Minister of Justice declines from rendering opinion on protests raised against tax ordinances on any of the grounds mentioned in Section 44 of the Local Tax Code (Opinion No. 57, Sec. of Justice s. 1977). Moreover, the Minister of Justice as a rule does not pass upon the validity of duly enacted ordinances, the matter being properly a matter for the courts to resolve (Op. No. 13, ibid.). We wish, however to make the following observations for your information and guidance: P.D. No. 7 was promulgated on September 30, 1972 for the purpose of regulating the price of meat and livestock products. It terminated the collection of all fees and charges on livestock and animal products, with the exception of certain fees specified in the said Decree and such fees as may be authorized by the Secretary of Agriculture and Natural Resources (now Minister of Agriculture and Food). The said national government official was vested by said Decree with the authority to approve the specific policies and procedures governing the flow of livestock and livestock products. The aforecited Decree was subsequently amended by P.D. No. 45 issued on November 12, 1972 and by the Local Tax Code which took effect on July 1, 1973. Pursuant to the latter, the municipal government is authorized to collect registration fees on large cattle for certificate of ownership and certificate of transfer and slaughterhouse fee including corral fee (Secs. 20 and 31, Local Tax Code). However, the said Code provides that a local counsel may impose by ordinance a tax or fee on: (1) a tax base or subject similar to those authorized in the Local Tax Code but which may not have been specifically enumerated therein; or (2) a tax base or subject which is not similar or comparable to any tax base or subject specifically mentioned or otherwise provided in the Local Tax Code (Sections 49 and 50, Local Tax Code). In both the above-mentioned cases, a public hearing is required to be held for said purpose and the tax or fee imposed shall accrue, should the ordinance be approved by the Minister of Finance, at such date as may be determined and fixed by the latter. Pertinently, it may be mentioned that Section 5 of the Local Tax Code prohibits the levy of taxes or impositions upon goods carried into or out of, or passing through the territorial jurisdiction of local governments. In view of the foregoing, may we advise you to bring to the attention of the Minister of Finance the objections you interpose against the subject municipal ordinance of the Sangguniang Bayan of Bongabong, Oriental Mindoro. Very truly yours, For the Minister of Justice: (SGD.) JESUS N. BORROMEO Deputy Minister