CTA: Tampakan LGU assessed SMI based on repealed provision of local tax ordinance

CTA: Tampakan LGU assessed SMI based on repealed provision of local tax ordinance

QUEZON CITY – In a nine-page resolution promulgated last February 10, 2023, the Court of Tax Appeals ruled in favor of Sagittarius Mines Incorporated (SMI)’s assertion that the company was assessed by the Tampakan local government unit (LGU) for local business tax deficiency based on a repealed provision of the municipality’s local tax ordinance.

Tampakan is a second-class municipality in the province of South Cotabato with a population of 41,018 people (2020 census).

“In this case, petitioner asserts that municipal respondents’ collection of its alleged deficiency business taxes, Mayor’s Permit Fees, and other regulatory fees as a contractor, for taxable years 2013 to 2022, in the amount of P401,454,015.12, is void, for being based on a provision of Municipal Ordinance No. 66, which has already been repealed by Municipal Ordinance No. 67,” the CTA said.

“For their part, municipal respondents assail the validity of Municipal Ordinance No. 67, stating that it is not a duly enacted law because it did not undergo a public hearing and was not published in a newspaper of general circulation.”

“In this case, this Court gives more credence to the duly signed, certified true copy of Municipal Ordinance No. 67, which was presented by the petitioner. In contrast, municipal respondents merely claim that Municipal Ordinance No. 67 is invalid due to lack of public hearing and publication,” the CTA stressed in its ruling.

“At this juncture, this Court finds it pertinent to note other noticeable infirmities, which municipal respondents failed to address in their Comment/Opposition.”

Court records show that Tampakan LGU’s Municipal Ordinance No. 67 was published in the Abante SOCSARGEN NEWS, a newspaper of general circulation in General Santos City and the Provinces of Sarangani and South Cotabato, and posted in three (3) publicly accessible places in the Municipality of Tampakan.

The Local Government Code of 1991 (Republic Act No. 7160) renders any local officials and responsible employees administratively liable for attempting to enforce any tax ordinance or revenue measure that is void or suspended.

(A. Inigo)

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