CHERRY BEPITEL

FACTS
Respondent Quezon City Council enacted an ordinance, Socialized Housing Tax of Quezon
City, which will collect 0.5% on the assessed value of land in excess of Php 100,000.00. This
shall accrue to the Socialized Housing Programs of the Quezon City Government. The special
assessment shall go to the General Fund under a special account to be established for the
purpose. On the other hand, Ordinance No. SP-2235 and S-2013 was enacted collecting
garbage fees on residential properties which shall be deposited solely and exclusively in an
earmarked special account under the general fund to be utilized for garbage
collections. Petitioner, a Quezon City property owner, questions the validity of the said
ordinances. Jose Ferrer, as a property in Quezon City questioned the validity of the city
ordinances.
According to Ferrer:
The city has no power to impose the tax.
The SHT violates the rule on equality because it burdens real property owners with expenses
to provide funds for the housing of informal settlers.
The SHT is confiscatory or oppressive.

ISSUES: Whether the Socialized Housing Tax is valid.

RULING: The SHT is valid. The tax is within the power of Quezon City Government to impose.
LGUs may be considered as having properly exercised their police power only if there is a
lawful subject and a lawful method. Herein, the tax is not a pure exercise of taxing power or
merely to raise revenue; it is levied with a regulatory purpose. The levy is primarily in the
exercise of the police power for the general welfare of the entire city. It is greatly imbued with
public interest. On the question of inequality, the disparities between a real property owner and
an informal settler as two distinct classes are too obvious and need not be discussed at length.
The differentiation conforms to the practical dictates of justice and equity and is not
discriminatory within the meaning of the Constitution. Notably, the public purpose of a tax may
legally exist even if the motive which impelled the legislature to impose the tax was to favor
one over another. Further, the reasonableness of Ordinance No. SP-2095 cannot be disputed.
It is not confiscatory or oppressive since the tax being imposed therein is below what the
UDHA actually allows. Even better, on certain conditions, the ordinance grants a tax credit.

*Validity of Socialized Housing Tax of Quezon City is upheld.

→ Ordinance No. SP-2235, S-2013, which collects an annual garbage fee on all domestic households in Quezon City,
is unconstitutional and illegal.