This case has been cited 1 times or more.
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2016-01-12 |
SERENO, C.J. |
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| Finally, petitioners allege that EDCA creates a tax exemption, which under the law must originate from Congress. This allegation ignores jurisprudence on the government's assumption of tax liability. EDCA simply states that the taxes on the use of water, electricity, and public utilities are for the account of the Philippine Government.[458] This provision creates a situation in which a contracting party assumes the tax liability of the other.[459] In National Power Corporation v. Province of Quezon, we distinguished between enforceable and unenforceable stipulations on the assumption of tax liability. Afterwards, we concluded that an enforceable assumption of tax liability requires the party assuming the liability to have actual interest in the property taxed.[460] This rule applies to EDCA, since the Philippine Government stands to benefit not only from the structures to be built thereon or improved, but also from the joint training with U.S. forces, disaster preparation, and the preferential use of Philippine suppliers.[461] Hence, the provision on the assumption of tax liability does not constitute a tax exemption as petitioners have posited. | |||||