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PHILIPPINE LONG DISTANCE TELEPHONE COMPANY v. CITY OF DAVAO

This case has been cited 6 times or more.

	GR No. 167260 2009-02-27	CITY OF ILOILO v. COMMUNICATIONS BRION, J.
Justice Carpio, in his Separate Opinion in PLDT v. City of Davao,[15] explains why:The proviso in the first paragraph of Section 9 of Smart's franchise states that the grantee shall "continue to be liable for income taxes payable under Title II of the National Internal Revenue Code." Also, the second paragraph of Section 9 speaks of tax returns filed and taxes paid to the "Commissioner of Internal Revenue or his duly authorized representative in accordance with the National Internal Revenue Code." Moreover, the same paragraph declares that the tax returns "shall be subject to audit by the Bureau of Internal Revenue." Nothing is mentioned in Section 9 about local taxes. The clear intent is for the "in lieu of all taxes" clause to apply only to taxes under the National Internal Revenue Code and not to local taxes.
	GR No.156040 2008-12-11	CITY GOVERNMENT OF BATANG CARPIO, J.
The interpretation of the phrase "exclusive of this franchise" in the Bayantel and Digitel cases goes against the basic principle in construing tax exemptions. In PLDT v. City of Davao,[65] the Court held that "tax exemptions should be granted only by clear and unequivocal provision of law on the basis of language too plain to be mistaken. They cannot be extended by mere implication or inference."
	GR No. 155491 2008-09-16	SMART COMMUNICATIONS v. CITY OF DAVAO NACHURA, J.
In this case, the doubt must be resolved in favor of the City of Davao. The "in lieu of all taxes" clause applies only to national internal revenue taxes and not to local taxes. As appropriately pointed out in the separate opinion of Justice Antonio T. Carpio in a similar case[25] involving a demand for exemption from local franchise taxes:[T]he "in lieu of all taxes" clause in Smart's franchise refers only to taxes, other than income tax, imposed under the National Internal Revenue Code. The "in lieu of all taxes" clause does not apply to local taxes. The proviso in the first paragraph of Section 9 of Smart's franchise states that the grantee shall "continue to be liable for income taxes payable under Title II of the National Internal Revenue Code." Also, the second paragraph of Section 9 speaks of tax returns filed and taxes paid to the "Commissioner of Internal Revenue or his duly authorized representative in accordance with the National Internal Revenue Code." Moreover, the same paragraph declares that the tax returns "shall be subject to audit by the Bureau of Internal Revenue." Nothing is mentioned in Section 9 about local taxes. The clear intent is for the "in lieu of all taxes" clause to apply only to taxes under the National Internal Revenue Code and not to local taxes. Even with respect to national internal revenue taxes, the "in lieu of all taxes" clause does not apply to income tax.
	GR NO. 152534 2007-02-23	DIGITAL TELECOMMUNICATIONS PHILIPPINES v. PROVINCE OF PANGASINAN CHICO-NAZARIO, J.
The issue in the PLDT v. City of Davao case was whether or not, by virtue of Section 23 of Republic Act No. 7925 (Public Telecommunications Policy of the Philippines), PLDT is again entitled to an exemption from the payment of local franchise tax in view of the grant of a tax exemption to Globe and Smart telecommunications companies. Before the enactment of Republic Act No. 7925 in 1995, the Congress of the Philippines granted in favor of Globe[17] and Smart[18] franchises[19] that contain "in-lieu-of-all-taxes" clauses or provisos. Then came Republic Act No. 7925, particularly Section 23 thereof, providing, more or less, that any advantage, favor, privilege, exemption, or immunity granted under existing franchises, or may hereafter be granted, shall be made part of previously enacted franchises and made automatically applicable to the grantees thereof. Subsequently, in "January 1999, when PLDT applied for a mayor's permit to operate its Davao Metro Exchange, it was required to pay the local franchise tax for the first to the fourth quarter of 1999 x x x. PLDT challenged the power of the city government to collect the local franchise tax and demanded a refund of what it had paid as local franchise tax for the year 1997 and for the first to the third quarters of 1998."[20] The latter believed itself to be exempt from payment of such tax even though Section 12 of its franchise (Republic Act No. 7082) containing the "in-lieu-of-all-taxes" proviso had already been withdrawn by the provisions of the Local Government Code. Its belief was anchored on the effect of the above-mentioned Section 23 of Republic Act No. 7925 - that because the franchises of Globe and Smart contain "in-lieu-of-all-taxes" clauses or provisos, the same grant of tax exemption must be regarded to have become ipso facto part of PLDT's previously granted telecommunications franchise.
	GR NO. 159991 2006-11-16	CARMELINO F. PANSACOLA v. CIR QUISUMBING, J.
This is not so in the case at bar. There is nothing in the NIRC that expresses any such intent. The policy declarations in its enactment do not indicate it was a social legislation that adjusted personal and additional exemptions according to the poverty threshold level nor is there any indication that its application should retroact. At the time petitioner filed his 1997 return and paid the tax due thereon in April 1998, the increased amounts of personal and additional exemptions in Section 35 were not yet available. It has not yet accrued as of December 31, 1997, the last day of his taxable year. Petitioner's taxable income covers his income for the calendar year 1997. The law cannot be given retroactive effect. It is established that tax laws are prospective in application, unless it is expressly provided to apply retroactively.[26] In the NIRC, we note, there is no specific mention that the increased amounts of personal and additional exemptions under Section 35 shall be given retroactive effect. Conformably too, personal and additional exemptions are considered as deductions from gross income. Deductions for income tax purposes partake of the nature of tax exemptions, hence strictly construed[27] against the taxpayer[28] and cannot be allowed unless granted in the most explicit and categorical language[29] too plain to be mistaken.[30] They cannot be extended by mere implication or inference.[31] And, where a provision of law speaks categorically, the need for interpretation is obviated, no plausible pretense being entertained to justify non-compliance. All that has to be done is to apply it in every case that falls within its terms.[32]
	GR NO. 165827 2006-06-16	NATIONAL POWER CORPORATION v. PROVINCE OF ISABELA CALLEJO, SR., J.
Indeed, taxation is the rule and exemption is the exception. The burden of proof rests upon the party claiming exemption to prove that it is, in fact, covered by the exemption so claimed.[23] Tax exemptions should be granted only by clear and unequivocal provision of law on the basis of language too plain to be mistaken. They cannot be extended by mere implication or inference.[24] In this case, petitioner relies solely on the exemption granted to it by its charter, arguing that its exemption from franchise tax remained despite the enactment of the LGC.