Pamantasang Lungsod ng Maynila

College of Law
Taxation 2
Thursdays, 6:00 p.m. to 9:00 p.m.
Second Semester SY 2019-20

Atty. Bernadette V. Quiroz

I. ESTATE TAX

Secs. 84-97, Sec. 104, NIRC, as amended by R.A. 10963 or the TRAIN Law
Revenue Regulations No. 12-2018 dated January 25, 2018 and issued March 15,
2018

General Principles & Determination of the Estate Tax

Lorenzo v. Posadas, G.R. No. 43082 dated June 18, 1937

Gross Estate – Rule for Imposition

1. Valuation of gross estate

a. Decedent’s interest
b. Transfer in contemplation of death

Alejandro v. Geraldez, G.R. Nos. L-33849 & L-33968 dated August 18,
1977 (donation inter vivos vs. donation mortis causa)
Gestopa v. CA G.R. No. 111904 dated October 5, 2000

c. Revocable transfer
d. Property passing under general power of appointment
e. Proceeds of life insurance
f. Prior interests
g. Transfers for insufficient consideration

2. Exclusion from gross estate: capital of surviving spouse

3. Deduction from gross estate

a. Standard deduction
b. Claims against the estate

Johannes v. Imperial, G.R. No. L-19153 dated June 30, 1922

Domingo v. Garlitos, G.R. No. L-18994 dated June 29, 1963
Philippine Deposit Insurance Corporation v. BIR, G.R. No. 158261 dated
December 18, 2006
Gabin v. Melliza, G.R. No. L-1849 dated October 25, 1949
Vera v. Fernandez, G.R. No. L-31364 dated March 30, 1979
Dizon v. CTA, G.R. No. 140944 dated April 30, 2008

c. Claims against insolvent persons

d. Unpaid mortgages and losses
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

e. Property previously taxed (vanishing deduction)

f. Transfers for public use
g. Family home
h. Amount Received by Heirs under R.A. 4917

4. Resident, non-resident alien

5. Reciprocity of exemption (Sec. 104)

Collector v. Fisher, 1 SCRA 93

6. Tax credits for estate taxes

7. Exemption of certain acquisitions and transmissions

8. Tax returns

a. Time to file and notice

Elegado v. CTA, G.R. No. L-68385 dated May 12, 1989

Marcos II v. CA, G.R. No. 120880 dated June 5, 1997 (effect of non-
filing of Estate Tax Return)

b. Payment of tax

9. Obligations of executor, administrator, officers, others

Vera v. Fernandez, G.R. No. L-31364 dated March 30, 1979

Pastor v. CA, G.R. No. L-56340 dated June 24, 1983

San Agustin v. CIR, G.R. No. 138485, September 10, 2001 (deficiency, Sec. 93)
Marcos II v. CA, G.R. No. 120880 dated June 5, 1997 (who has control over the
collection of estate tax)
Polido v. CA, G.R. No. 170632 dated July 10, 2007 (withdrawals from bank deposit
accounts); Sec. 97, TRAIN Law

II. DONOR’S TAX

Secs. 98-104, NIRC, as amended by R.A. 10963 or the TRAIN Law

Revenue Regulations No. 12-2018 dated January 25, 2018 and issued March 15,
2018

Pirovano v. CIR, G.R. No. L-19865 dated June 31, 1965

Alejandro v. Geraldez, G.R. Nos. L-33849 & L-33968 dated August 18, 1977
(donation inter vivos vs. donation mortis causa)
Bonsato v. CA, 95 Phil 481
Castro v. CA, G.R. No. L-20122 dated April 28, 1969, 27 SCRA 1076
Austria-Magat v. CA, G.R. No. 106755 dated February 1, 2002
Del Rosario v. Ferrer, G.R. No. 187056 dated September 20, 2010
Puig v. Peñaflorida, G.R. No. L-15939 dated January 31, 1966

Page 2
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

BIR Ruling No. 089-2011 dated March 21, 2011

BIR Ruling No. 109-2011 dated April 7, 2011

1. Imposition of gift tax

2. Transfer for inadequate consideration

CIR v. B.F. Goodrich Phils., Inc., G.R. No. 104171 dated February 24, 1999

3. Exemption from gift tax

BIR Ruling No. 124-2011 dated April 12, 2011

BIR Ruling No. 128-2013 dated April 4, 2013
Rev. Regs. 13-98
RMC 8-2014
RMO 20-2013, as amended by RMO 44-2016
RMC 86-2014

4. Tax credit

5. Tax return (time of filing and payment)

6. Political contributions: tax treatment

Abello v. CIR, G.R. No. 120721 dated February 23, 2005

CIR v. B.F. Goodrich Phils., Inc., G.R. No. 104171 dated February 24, 1999
Sumipat v. Bonga, G.R. No. 155810 dated August 13, 2004

III. VALUE-ADDED TAX

1. Secs. 105-115, NIRC, as amended by RA 8424 & RA 9238 (February 5, 2004),

RA 9337 (effective July 1, 2005) as implemented by RR 16-2005 (November 1,
2005) & RR 4-2007 (February 7, 2007), and RA 10963 (December 19, 2017)

2. CIR v. Seagate Technology Phils., G.R. No. 153866 dated February 11, 2005
(concept of VAT; effectively zero-rated transactions with PEZA)

3. Panasonic Communications Imaging Corporation of the Philippines v. CIR, GR

No. 178090 dated February 8, 2010 (concept of VAT)

4. CIR v. Benguet Corporation, GR No. 145559 dated July 14, 2006 (concept of
input tax and output tax)

Sec. 105

5. Contex Corporation v. CIR, GR No. 151135 dated July 2, 2004 (liability for the
tax vs. burden of the tax)

Page 3
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

6. CIR v. Magsaysay Lines, G.R. No. 146984 dated July 28, 2006 (No VAT on sale
not made in the course of trade or business.)

7. Mindanao II Geothermal v. CIR, GR No. 193301 dated March 11, 2013 (an
isolated sale transaction may be considered an incidental transaction made in the
course of business subject to VAT)

8. CIR v. Court of Appeals, COMASERCO, G.R. No. 125355 dated March 30,
2000 (whether reimbursements are subject to VAT)

RMC 9-2006 dated January 25, 2006 (clarifying brokers and others similarly
situated)

RMC 39-2007 dated January 22, 2007 (Agency Fees/Gross Receipts of Security
Agencies); BIR Ruling No. 213-2015 dated June 19, 2015 (RMC 39-2007 does
not apply to manpower agencies other than security agencies, e.g., janitorial and
clerical services agencies, because there is nothing in the RMC which would
suggest this)

RMC 35-2012 dated August 3, 2012 (Taxability of Clubs Organised and

Operated Exclusively for Pleasure, Recreation, and Other Non-Profit Purposes)

RMC 65-2012 dated October 31, 2012 (Taxability of Association Dues,

Membership Fees, and Other Assessments/Charges Collected by Condominium
Corporations); Sec. 109(1)(Y), RA 10963 (VAT exemption of association dues,
membership fees, and other assessments and charges collected by homeowners
associations and condominium corporations)

RMC 89-2012 dated December 27, 2012 (Tax Implications and Recording of
Deposits/Advances Made by Clients of GPPs for Expenses)

Sec. 106

9. CIR v. Sony Philippines, Inc., G.R. No. 178697 dated November 17, 2010 (what
comprises a sale of goods or properties or a sale of services)

10. CIR v. Benguet Corporation, G.R. Nos. 134587 and 134588 dated July 8, 2005
(VAT rating vs. zero-rating)

11. Contex Corporation v. CIR, GR No. 151135 dated July 2, 2004, supra (VAT zero-
rating vs. VAT exemption)

12. CIR v. Seagate Technology Phils., G.R. No. 153866 dated February 11, 2005,
supra (VAT zero-rating vs. VAT exemption; zero-rated vs. effectively zero-rated
transactions; VAT on importation)

13. CIR v. Cebu Toyo Corporation, GR 149073 dated February 16, 2005

14. CIR v. Toshiba Information Equipment (Phils.), Inc., GR No. 150154 dated
August 9, 2005 (export sales; cross-border doctrine)

Page 4
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

15. Toshiba Information Equipment (Phils.), Inc. v. CIR, GR No. 157594 dated
March 9, 2010 (VAT zero-rating vs. VAT exemption)

16. Intel Technology Philippines, Inc. v. CIR, GR No. 166732 dated April 27, 2007
(proof of export sales)

17. Atlas Consolidated Mining and Development Corporation v. CIR, GR No.

146221 dated September 25, 2007 (minimum 70% export sales to qualify for
VAT zero-rating)

18. Panasonic Communications Imaging Corporation of the Philippines v. CIR, GR

No. 178090 dated February 8, 2010, supra (example of export sales under the
Omnibus Investment Code of 1987 and other special laws)

19. San Roque Power Corporation v. CIR, GR No. 180345 dated November 25, 2009
(transaction deemed sale)

Sec. 107

20. CIR v. Seagate Technology Phils., G.R. No. 153866 dated February 11, 2005,
supra (VAT on importation)

Sec. 108

21. CIR v. Sony Philippines, Inc., G.R. No. 178697 dated November 17, 2010, supra
(what comprises a sale of goods or properties or a sale of services)

22. Quezon City v. ABS-CBN Broadcasting Corporation, GR No. 166408 dated

October 6, 2008 (sale of services by franchise grantees, when subject to VAT)

23. CIR v. Court of Appeals, COMASERCO, G.R. No. 125355 dated March 30,
2000, supra (sale of services)

24. CIR v. SM Prime Holdings, Inc., G.R. No. 183505 dated February 26, 2010 (sale
of services)

25. Sonza v. ABS-CBN Broadcasting Corporation, GR No. 138051 dated June 10,
2004 (sale of services)

26. CIR v. American Express International Inc. (Philippine Branch), GR No. 152609
dated June 29, 2005 (destination principle; services other than processing,
manufacturing or repacking of goods)

27. RMC 74-99 dated October 15, 1999 – tax treatment of sales of goods and
services made by suppliers from western territory to a PEZA registered
enterprise and sale transactions made by PEZA registered enterprises within and
without the zone. (Destination or Cross Border Principle first adopted in BIR
Ruling No. 032-98 dated November 5, 1998 re. Shimizu Philippines); as amended
by: RR 2-2005 dated February 8, 2005; RR 11-2005 dated April 25, 2005; Sec.
4.106-5 of RR 16-2005; Sec. 4.106-5 of RR 4-2007; RMC 23-2013.

Page 5
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

28. CIR v. Placer Dome Technical Services (Philippines), Inc. GR No. 164365 dated
June 8, 2007 (services other than processing, manufacturing or repacking of
goods)

29. CIR v. Burmeister and Wain Scandinavian Contractor Mindanao, Inc., GR No.
153205 dated January 22, 2007 (qualification for VAT zero-rating: recipient must
be doing business outside the Philippines)

30. CIR v. Acesite (Philippines) Hotel Corporation, GR No. 147295 dated February
16, 2007 (effectively zero-rated sales)

31. San Roque Power Corporation v. CIR, GR No. 180345 dated November 25,
2009, supra (effectively-zero rated sales)

Sec. 109

32. CIR v. Seagate Technology Phils., G.R. No. 153866 dated February 11, 2005,
supra (exempt transaction vs. exempt party)

33. Misamis Oriental Association of Coco Traders, Inc. v. DOF, GR No. 108524
dated November 10, 1994 (the classification of a product, whether food or non-
food for purposes of the VAT exemption, by the BIR prevails over the BFD)

34. CIR v. Philippine Health Care Providers, Inc., GR No. 168129 dated April 24,
2007 (medical, dental, hospital and veterinary services)

35. Sonza v. ABS-CBN Broadcasting Corporation, GR No. 138051 dated June 10,
2004, supra (sale of services: employee vs. independent contractor)

36. Philippine Amusement & Gaming Corporation v. CIR, GR No. 172087 dated
March 15, 2011 (transactions exempt under international agreements or under
special laws)

37. First Planters Pawnshop, Inc. v. CIR, G.R. No. 174134 dated July 30, 2008 (tax
treatment of a pawnshop business)

Sec. 110

38. CIR v. Benguet Corporation, GR No. 145559 dated July 14, 2006, supra (concept
of input tax and output tax)

39. RA 9361 dated December 13, 2006, repealing the 70% input VAT cap, as
implemented by RR 2-2007 dated December 29, 2006

Sec. 111

40. Fort Bonifacio Dev’t. Corp. v. CIR, G.R. Nos. 158885 and 170680 dated April 2,
2009 (presumptive input tax)

Sec. 112

Page 6
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

41. CIR v. Seagate Technology Phils., G.R. No. 153866 dated February 11, 2005,
supra (zero-rated vs. effectively zero-rated transactions)

42. Intel Technology Philippines, Inc. v. CIR, GR No. 166732 dated April 27, 2007,
supra (requirements for VAT refund/credit)

43. San Roque Power Corporation v. CIR, GR No. 180345 dated November 25,
2009, supra (requirements for VAT refund/credit)

44. Atlas Consolidated Mining and Development Corporation v. CIR, GR Nos.

141104 & 148763 dated June 8, 2007 (VAT refund/credit: reckoning point for 2-
year prescriptive period)

45. CIR v. Mirant Pagbilao Corporation, GR No. 172129 dated September 12, 2008
(VAT refund/credit: reckoning point for 2-year prescriptive period)

Sec. 113

46. CIR v. Manila Mining Corporation, GR No. 153204 dated August 31, 2005
(invoice vs. official receipt)

47. AT&T Communications Services Philippines, Inc. v. CIR, GR No. 182364 dated
August 3, 2010 (sales invoices)

48. KEPCO Philippines Corporation v. CIR, G.R. No. 181858 dated November 24,
2010 (VAT invoice vs. VAT receipt)

49. Panasonic Communications Imaging Corporation of the Philippines v. CIR, GR

No. 178090 dated February 8, 2010, supra (the term “zero-rated” must be
imprinted, not merely written or stamped)

50. JRA Philippines, Inc. v. CIR, GR No. 177217 dated October 11, 2010 (the term
“zero-rated” must be imprinted, not merely written or stamped)

51. Hitachi Global Storage Technologies Philippines Corporation v. CIR, GR No.

174212 dated October 20, 2010 (the term “zero-rated” must be imprinted, not
merely written or stamped)

52. Microsoft Philippines, Inc. v. CIR, G.R. No. 180173 dated April 6, 2011 (the term
“zero-rated” must be imprinted, not merely written or stamped)

Others

53. RR 16-2011 (increasing threshold amounts under Sec. 109(p), (q) and (v)), in
relation to RR 13-2018 (implementing the VAT provisions under RA 10963)

Note: With respect to Sec. 109(p), the threshold for VAT exemption was
previously as follows: (a) Sale of residential lot valued at P1.5M and below; (b)
Sale of house & lot and other residential dwellings valued at P2.5M and below.
These maximum thresholds were increased in RR 16-2011 to P1,919,500 and
P3,199,200, respectively. However, when RA 10963 was enacted, said law, as well

Page 7
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

as its implementing regulations, RR 13-2018, reverted to the maximum

thresholds of P1.5M and P2.5M, respectively.

54. RR 6-2001 dated July 31, 2001 (payment of VAT within 10 days after the end of
the month), as amended by RR 8-2002 dated June 13, 2002 (filing of VAT
returns), as amended by RA 10963 and RR 13-2018

Note: Under RR 6-2001, monthly VAT returns are due within 10 days after the
close of each month, while quarterly VAT returns are due within 25 days
following the close of the calendar quarter. Under RR 8-2002, the deadline for
monthly VAT returns was amended to 20 days after the end of each month.
Under RA 10963 and RR 13-2018, the same deadlines under RR 8-2002 apply.
However, beginning January 1, 2023, the filing and payment of VAT shall only
be on a quarterly basis, within 25 days following the close of each taxable
quarter.

55. RR 17-2003 (VAT on refined sugar), as amended by RR 2-2004 dated March 1,

2004, and RR 16-2005, and amended by RR 13-2008 dated September 14, 2008

56. RR 18-2011 (penalties for violation of requirement that output tax be separately
indicated in invoice/OR)

IV. OTHER PERCENTAGE TAXES

Sec. 116 Tax on persons exempt from VAT

Secs. 117-118 Carriers tax, as amended by RA 9377 dated July 1, 2005

RR 11-2011 dated July 20, 2011 – Revenue Regulations Defining

Gross Receipts for Common Carrier’s Tax for International
Carriers pursuant to Section 118 of the Tax Code, amending Sec.
10 of RR 15-2002

Sec. 119 Tax on franchises

Sec. 120 Overseas communications tax

Page 8
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

Sec. 121 Tax on banks and financial intermediaries, as amended by RA

7716 & RA 9238

China Banking Corp. v. CTA, SC G.R. No. 146749 dated June 10,
2003 (base of 5% GRT on interest income)

RA 9238, as implemented by RR 9-2004 (GRT on banks)

RA 9337, effective July 1, 2005, on increase of GRT to 7% on

other income of banks

BIR RMC 62-2016 (Tax Treatment of Passed-on GRT)

The effectivity of this circular was suspended on July 1, 2016 by
the new Commissioner of Internal Revenue. However, on
November 15, 2016, the suspension was lifted by RMC No.
127-2016 rendering RMC No. 62- 2016 effective immediately.

Sec. 122 Tax on finance companies

BIR Ruling dated August 16, 1990 re. credit card companies, as
amended by RA 9238

Sec. 123 Tax on insurance premiums, as amended by RA 10001

Sec. 124 Tax on agents of foreign insurance companies

Sec. 125 Amusement taxes

RMC 8-88 dated February 19, 1988, p. 785, Nolledo

Sec. 126 Tax on winnings

Sec. 127 Percentage tax on IPOs

Sec. 128 Payment of percentage taxes, as amended by RA 10963

BIR Tax Advisories dated February 8, 2018, February 19, 2018,

and April 10, 2018

RMC 26-2018

Republic of the Philippines v. Sunlife Assurance Company of Canada, G.R. No.

158085 dated October 14, 2005

Page 9
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

CIR v. Lhuillier, SC G.R. No. 150947 dated July 15, 2003 (pawnshops are not
lending investors)

First Planters Pawnshop, Inc. v. CIR, G.R. No. 174134 dated July 30, 2008

RR 10-2004 re. 5% GRT on pawnshops (beginning January 2004); also, RR

13-2018 re. Money Shops or Forex Shops

V. EXCISE TAXES ON CERTAIN GOODS

Chapters 1 and 2

Sec. 129 to Sec. 140, NIRC, as amended by RA 10351 and 10963

Chapter 3 – Excise tax on alcohol products

Sec. 141 to 143, NIRC, as amended by RA 10351 and RA 10963

Chapter 4 – Excise tax on tobacco products

Secs. 144-147, NIRC, as amended by RA 10351 and 10963

British American Tobacco v. Jose Camacho, G.R. No. 163583 dated August 20,
2008; motion for reconsideration, April 15, 2009

Chapters 5 and 6 – Excise tax on petroleum products and miscellaneous articles

Secs. 148 to 150-B, NIRC, as amended by RA 10963

RR Nos. 5-2018 issued on January 15, 2018, and 24-2018 issued on November 28,
2018

RR 20-2018 (sweetened beverages)

Exxonmobil Petroleum and Chemical Holdings, Inc. Philippine Branch v. CIR,

G.R. No. 180909 dated January 19, 2011

CIR v. Pilipinas Shell Petroleum Corporation, G.R. No. 188497 dated April 23,
2012

Chapter 7 – Excise tax on mineral products

Sec. 151, NIRC, as amended by RA 10963

Chapter 8 – Administrative Provisions

Sec. 152 to 172, NIRC, as amended by RA 10963

Page 10
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

VI. DOCUMENTARY STAMP TAX

Secs. 173-201, NIRC, as amended by RA 8424 & RA 9243 (February 7, 2004), RR

13-2004 dated December 23, 2004, RA 10963 (December 19, 2017), RR 4-2018 dated
December 19, 2017

CIR v. Construction Resources of Asia, Inc., 145 SCRA 673 (Issuance of shares of
stock)

Philippine Consolidated Coconut Industries v. CIR, G.R. No. L-25424 dated March
8, 1976 (70 SCRA 22) (Reckoning point of due date for DST on original issuance
of shares)

RMC 44-86 dated December 4, 1986, p. 877, Nolledo

RA 7660 dated December 23, 1993, effective January 14, 1994

RR 9-94 dated March 8, 1994, New DST Regulations

RR 6-2001 dated July 31, 2001 (Payment of DST within 5 days)

As amended by RR 15-2001 dated October 16, 2001

Exemption from DST of shares listed and traded in Stock Exchange (RA 9648)
and tax-free exchanges (RA 9243) and RR 13-2004

Banco de Oro v. CIR, CTA EB No. 165 dated August 16, 2006 (SSA subject to
DST as time deposit certificate)

CIR v. First Express Pawnshop Company, Inc., G.R. Nos. 172045-46 dated June
16, 2009 (Deposit for future subscription)

CIR v. Filinvest Development Corporation, G.R. Nos. 163653 dated July 19, 2011
(DST on inter-company advances)

BIR RMC 48-2011 issued on October 6, 2011 (Circularizing the above decision
in the Filinvest case)

CIR v. Manila Bankers’ Life Insurance Corporation, G.R. No. 169103 dated March
16, 2011

Supreme Transliner, Inc. v. BPI Family Savings Bank, Inc., G.R. No. 165617 dated
February 25, 2011 (Foreclosure sale of real property)

RMC 58-2008 dated August 15, 2008 (issued on August 27, 2008), as amended by
RMC 55-2011 dated November 10, 2011 (reckoning point of the deadline for
payment of taxes on foreclosure sales, including DST)

Page 11
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

VII. REMEDIES

1. Sec. 4, NIRC, Power of Secretary of Finance to review rulings of CIR as

implemented by RMC 44-2001 dated October 11, 2001, and DOF Order No. 7-02
dated May 7, 2002

3. Secs. 5, 6-17, 202-282, NIRC (Emphasis on Secs. 6, 7, 204, 228, 247, 248 and 249)

4. RMC 48-90 dated April 23, 1990 (counting of 3-year period of 365 x 3 regardless of
leap year; Asianbank v. Commissioner, CTA Case No. 6095 dated October 9, 2001)

4. RR 12-99, implementing the provisions of the NIRC on rules of assessment, civil

penalties and interest and extra-judicial settlement of taxpayer’s criminal violation
under RMO 1-90, as amended by RR 18-2013, RMC 11-2014 and RR 17-2018

5. RMO 20-90 dated April 4, 1990, in relation to Revenue Delegation Authority Order
No. 5-2001 and RMC 6-2005, as amended by RMO 14-2016 (Proper execution of
the waiver of the statute of limitations.)

6. Cases:

6.1. CIR v. Sony Philippines, Inc. G.R. No. 178697 (November 17, 2010) (Validity
of assessments under an LOA.)

6.2. Dakay Construction and Development Corporation vs. CIR, CTA EB 1294,
September 20, 2016 (Validity of assessments under an LOA.)

6.3. CIR v. De La Salle University, G.R. No. 196596 (November 9, 2016) (Validity
of assessments under an LOA.)

6.4. Medicard Philippines Inc. v. CIR, G.R. No. 222743 (April 5, 2017) (Validity
of assessments under an LN.)

6.5. Spouses Emmanuel Pacquiao and Jinkee Pacquiao v. CTA, G.R. No. 213394
(April 6, 2016) (Absence of NIC.)

6.6. International Exchange Bank v. CIR, G.R. No. 171266 (April 4, 2007)
(Assessment is valid even where FAN is issued within 15-day period to reply
to PAN.)

6.7. CIR v. Metro Star Superama, Inc., G.R. No. 185371 dated December 8, 2010
(Failure to strictly comply with the notice requirements under Sec. 228, 1997
NIRC is a denial of due process rendering the assessment void.)

6.8. CIR v. United Salvage and Towage (Phils.), Inc., G.R. No. 197515 (July 2,
2014) (Mandatory nature of the requirements laid down in Sec. 228, Tax
Code.)

6.9. Medtex Corporation v. CIR, CTA Case No. 8508 (September 1, 2014)
(Relaxed the compliance with the due process requirements under the Tax
Code and RR 12-99.)

Page 12
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

6.10. Samar-I Electric Cooperative v. CIR, G.R. No. 193100 (December 10, 2014)
(Substantial compliance with Sec. 228, Tax Code.)

[Note, however, that notwithstanding the Medtex case and Samar I case above,
following Sec. 3.1.2, RR 18-2013, amending RR 12-99, the prevailing
principle is that the service of a PAN is mandatory, save in the exceptions
under Sec. 228, Tax Code.]

6.11. People of the Philippines v. Edwin T. So, Raymond R. Lee, Techpoint

Computer Corporation, CTA EB Crim. Case No. 028 dated March 6, 2015
(Constructive service of PAN and FLD covering 2005 and unverified prior
years to an employee witnessed by barangay officials is not valid.)

6.12. Bloat and Ogle, Inc. v. CIR, CTA Case No. 8682, September 2, 2016 (Non-
service of PAN is a denial of due process.)

6.13. Missouri Square Inc. v. CIR, CTA Case No. 8707, September 8, 2016
(Violation of the 15-day period to file a reply to the PAN.)

6.14. CIR v. Apex Chemical Corporation, CTA EB Case No. 1382, October 14,
2016 (Violation of the 15-day period to file a reply to the PAN.)

6.15. Freelife Philippines Distribution, Inc. Philippine branch vs Hon. Kim S.

Jacinto-Henares in her capacity as CIR, CTA Case No. 8838, April 27, 2017
(Violation of the 15-day period to file a reply to the PAN.)

6.16. CIR v. SVI Information Services, Inc., CTA EB Case No. 1149 (March 3,
2016) (What is a disputed assessment?)

6.17. RP v. CTA & Nielson & Co., G.R. No. L-38540, 149 SCRA 351
Demand letter/follow-up letter for payment of taxes considered notice of
assessment.

6.18. CIR v. Benipayo, G.R. No. L-13656 (January 31, 1962) (Requisites of a valid
assessment.)

6.19. CIR v. Azucena Reyes, G.R. No. 159694 dated January 27, 2006 (Taxpayers
shall be informed in writing of the law and the facts on which the
assessment is made, otherwise, the assessment shall be void.)

6.20. CIR v. Enron Subic Power Corp., G.R. No. 166387 dated January 19, 2009
(To be valid, an assessment must state its factual and legal bases.)

6.21. Philippine Aerospace Development Corp. v. CIR, CTA Case No. 7830
(December 11, 2012) (An assessment must be based on facts and not
presumptions.)

6.22. CIR v. Gonzales, et. al., G.R. No. 177279 dated October 13, 2010 (The
formality of a control number in the assessment notice is not a requirement

Page 13
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

for its validity; rather the contents thereof should inform the taxpayer of the
declaration of deficiency tax against the taxpayer.)

6.23. CIR v. Mindanao Sanitarium and Hospital, Inc., CTA EB No. 1147 (October
5, 2012) (An assessment must demand payment within a prescribed period.)

6.24. CIR vs Derek Arthur P. Ramsay, CTA EB 1413, June 22, 2017 (To be valid,
the FLD should not only contain a computation of tax liabilities but also a
demand for payment within a prescribed period.)

6.25. CIR v. BASF Coating, G.R. No. 198677 dated November 26, 2014 (An
invalid assessment bears no valid fruit.)

6.26. Collector v. Bautista, G.R. Nos. L-12250 and L-12259 dated May 27, 1959
Notice of Assessment deemed made when notice is released, mailed and
does not require that notice be received within the 3-year prescriptive period
for assessment.

6.27. Republic v. Ricarte, G.R. No. L-46893 dated November 12, 1985
Action to assess prescribed since there was no proof that notice was sent.

6.28. Nava v. CIR, G.R. No. L-19470 (January 30, 1965) (Presumption that the
assessment was received when the taxpayer denies receipt.)

6.29. Basilan Estates, Inc. v. CIR, G.R. No. L-22492 (September 5, 1967)
(Presumption that the assessment was received by the taxpayer.)

6.30. CIR v. Coolmate Corporation, CTA EB No. 1226 (June 8, 2016)

(Presumption that the assessment was received when the taxpayer denies
receipt.)

6.31. Royal Bank of Scotland (Philippines) Inc. v. CIR, CTA EB No. 446 (October
23, 2009) (60-day period applies only to requests for reinvestigation, not to
requests for reconsideration)

6.32. CIR v. Wyeth, G.R. No. 762281 dated September 30, 1991
Secs. 222 & 223, request for reinvestigation suspends the 5-year period for
collection of tax.

6.33. BPI v. CIR, G.R. No. 174942 dated March 7, 2008

Suspension of collection requires request for reinvestigation to be granted.

6.34. Advertising Associates v. CTA, 133 SCRA 765, p. 939 Nolledo

Reviewable decision of CIR is where he directs taxpayers to appeal to CTA
not mere issuances of warrants of distraint and levy.

6.35. CIR v. Union Shipping, G.R. No. 66160 dated May 21, 1990
Demand to pay deficiency tax considered final decision of CIR.

6.36. Surigao Electric v. CTA, 57 SCRA 523

Page 14
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

CIR should categorically state whether order is final determination so that it

can be appealed to CTA.

6.37. CIR v. Isabela Cultural Corporation, G.R. No. 135210 dated July 11, 2001
Final demand letter from BIR is tantamount to denial of request for
reconsideration which is therefore appealable to CTA.

6.38. Ocenanic Wireless Network v. CIR, G.R. No. 148380 dated December 9,
2005
Final demand letter from BIR is tantamount to denial of request for
reconsideration which is therefore appealable to CTA.

6.39. CIR v. Lascona Land Co., Inc., CA-G.R. SP No. 58061 dated October 25,
2005
When to elevate assessment to CTA.

6.40. RCBC v. CIR, G.R. No. 168498 dated April 24, 2007.
Options for disputing tax assessment mutually exclusive under Sec. 228.
[Note: Sec. 3.1.4 of RR 18-2013 now expressly provides for this.]

6.41. San Agustin v. CIR, G.R. No. 138485 dated September 10, 2001.
TP can appeal a disputed assessment despite payment of deficiency tax.
Filing of refund not necessary for this purpose.

Waiver

6.42. Philippine Journalists, Inc. v. CIR, G.R. No. 162952 dated December 16,
2004
Waiver of prescription must be executed properly per RMO 20-90,
otherwise, invalid.

6.43. CIR v. FMF Development Corp., G.R. No. 167765 dated June 30, 2008
(Validity of waiver.)

6.44. CIR v. Kudos Metal, G.R. No. 178087 dated May 5, 2010 (Invalid for lack of
notarized written authority of taxpayer’s representative, etc.)

6.45. CIR v. Next Mobile, G.R. No. 212825 dated December 7, 2015 (In pari
delicto and Estoppel can lead to validity of otherwise invalid waivers)

Collection

6.46. CIR v. Phil. Global Communications, G.R. No. 167146 dated October 31,
2006
Prescriptive period to collect taxes assessed by CIR.

Refund

6.47. Gibbs v. Commissioner, G.R. No. L-17406 dated November 29, 1965
Period to file refund claim.

Page 15
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

Gibbs v. Collector, G.R. No. L-13453 dated February 29, 1960

2-year period is absolute.

If income of taxpayer is withheld at source, he is deemed to have paid his

tax liability at the end of the tax year. It is from this date that the 2-year
period will run.

6.48. CIR v. TMX Sales & CTA, G.R. No. 83736 dated January 16, 1992
When to count 2-year period if on installment basis. If TP pays income tax
on quarterly basis, the 2-year period is counted from the time of filing final
adjustment return.

6.49. Commissioner v. Philamlife Insurance Co., G.R. No. 105208 dated May 29,
1995
Obiter by Justice Vitug referring the 10-year period on taxes not
erroneously/illegally paid. Likewise, the claim must be filed within 2 years
regardless of supervening cause.

Also, in this case, Pacific Pro, Ltd. Case (G.R. No. 68013 dated November
12, 1984), counting of 2-year prescriptive period for filing claim for refund
of overpaid corporate income tax starts from time final adjustment return is
filed.

6.50. FEBTC v. CIR, G.R. No. 138919 dated May 2, 2006 (Filing of judicial refund
within the 2-year prescriptive period.)

6.51. United Airlines v. CIR, G.R. No. 178788 dated September 29, 2010 (Tax
refunds, like tax exemptions, are construed strictly against the taxpayer and
liberally in favor of the taxing authority.)

6.52. Petron Corporation v. CIR, G.R. No. 180385 dated July 28, 2010 (Tax Credit
Certificates granted pursuant to a tax refund.)

Jurisdiction

6.53. Judy Anne L. Santos v. People of the Phils., G.R. No. 173176 dated August
26, 2008 (Jurisdiction of the CTA En Banc; “willful blindness” doctrine.)

6.54. Asia International v. Parayno, 540 SCRA 536 (2007) (Jurisdiction to hear
cases impugning the validity of RMCs, RTC or CTA.)

6.55. British American Tobacco v. Camacho, 562 SCRA 511 (2008) (Jurisdiction to
hear cases impugning the validity of RRs, RTC or CTA.)

Others

6.56. Fitness by Design, Inc. v. CIR, G.R. No. 177982 dated October 17, 2008
(Power of the CIR to access all relevant or material records of the taxpayer
under Sec. 5, NIRC.)

6.57. ABS-CBN Broadcasting Corp. v. CTA, 108 SCRA 143

Page 16
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

Non-retroactivity of rulings requiring 3 years back taxes after previous

circular violated Sec. 246.

6.58. Commissioner v. Court of Tax Appeals and Fortune Tobacco, G.R. No.
119761 dated August 29, 1996
Requirements for the validity of BIR issuances (RMC); legislative rule vs.
interpretative rule.

6.59. Emilio S. Lim v. Court of Appeals, G.R. No. L-48134-37 dated October 18,
1990
Prescriptive period to file criminal case under Sec. 281, NIRC, 5 years from
failure to pay tax after notice and demand.

6.60. CIR v. Pascor Realty & Development Corp., G.R. No. 128315 dated June 29,
1999
Assessment not necessary before filing criminal complaint for tax evasion
based on Sec. 222, NIRC.

6.61. Commissioner v. Court of Appeals, Lucio Tan, et. al., G.R. No. 119322 dated
June 4, 1996
Fraud cannot be presumed. Deficiency assessment is not necessary prior to
prosecution. However, for criminal prosecution to proceed before
assessment, there must be a prima facie  showing of a  willful attempt  to evade
taxes.

8. RR 11-2006 dated June 15, 2006 (Accreditation of Tax Practitioners to Practice

before BIR), as amended by RR Nos. 4-2010 and 14-2010

9. RA 9282, expanding the jurisdiction of the CTA, elevating it to collegiate court,

amending RA 1125 (effective April 23, 2004)

10. RA 9503, further expanding the composition of the CTA by adding 3 new justices (9
in all)

VIII. LOCAL TAXATION

A. Local Government Taxation

1. Sections 128-196, Local Government Code (“LGC”)

2. Alejandro Ty v. Hon. Trampe & Municipal Assessor of Pasig, G.R. No. 117577
dated December 1, 1995

3. Progressive Development Corp. v. Quezon City, GR L-36081 dated April 24,

1989

4. Tatel v. Virac, GR 40243 dated March 11, 1992

5. Rule XXX, Arts. 217-287 (Rules and Regulations Implementing the Local
Government Code)

Page 17
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

6. Local Finance Circular No. 1-93 (Banks)

7. Local Finance Circular No. 2-93 (Insurance Companies)

8. Local Finance Circular No. 3-93 (Finance Companies)

9. Memo Circular No. 92-02 dated January 16, 1992, issued by the Department of
Interior and Local Government

10. Memo Circular No. 5-93 dated October 22, 1993, issued by the Department of
Finance

11. Province of Bulacan v. Court of Appeals, GR 126232 dated November 27, 1998

12. First Phil. Industrial v. Court of Appeals, GR 125948 dated December 29, 1998

13. LTO v. City of Butuan, GR 131512 dated January 20, 2000

14. City Gov’t. of San Pablo v. Reyes, GR 127708 dated March 25, 1999

15. Meralco v. Province of Laguna, GR 131359 dated May 5, 1999

16. Reyes v. CA, GR 118233 dated December 10, 1999

17. Sec. Drilon v. Mayor Lim, G.R. No. 112497 dated August 4, 1994, Manila Tax
Ordinance

18. Coca-Cola Bottlers Phils., Inc. v. City of Manila, G.R. No. 156252 dated June 27,
2006 (validity of Manila Tax Ordinance)

19. International Container Terminal Services, Inc. v. City of Manila, CTA A.C. No.
11 dated May 22, 2006 (Manila Tax Ordinance, Sec. 21(A) – Double Taxation)

20. Phil. Match Co. Ltd. v. City of Cebu, 81 SCRA 99 dated January 18, 1999 (situs
of payment of local business tax)

21. PLDT v. City of Davao, G.R. No. 143867 dated March 25, 2003 (PLDT liable to
franchise tax imposed by city)

22. Palma Development Corp. v. Municipality of Malangas, G.R. No. 152492 dated
October 16, 2003

23. PLDT v. Province of Laguna, G.R. No. 151899 dated August 16, 2005

24. Yamane v. BA Lepanto Condo Corp., SC G.R. No. 154993 dated October 25,
2005 (condominium corporation is not business entity)

25. Ericsson Telecoms Inc. v. City of Pasig, G.R. No. 176667 dated November 22,
2007

Page 18
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

26. Lepanto Consolidated Mining Company v. Hon. Mauricio B. Ambaloc in his

capacity as the Provincial Treasurer of Benguet, G.R. No. 180639 dated June 29,
2010

27. Angeles City v. Angeles City Electric Corporation and Regional Trial Court
Branch 57, Angeles City, G.R. No. 166134 dated June 29, 2010

28. Tiu v. CA, GR 127410 dated January 20, 1999

29. Iloilo Bottlers v. City of Iloilo, GR L-52019 dated August 19, 1988

30. Angeles v. Angeles Electric Corp., GR 166134 dated June 29, 2010

B. Real Property Taxation

1. Legal Provisions

Secs. 197-283 Definition of Machinery and Equipment

Sec. 199 LGC
SEC. 299 Implementing Rules and Regulations
Sec. 202 Declaration of real property
Secs. 215-216 Classes of real property
Sec. 218 Assessment levels
Secs. 226-230 Local Board Assessment Appeals
Central Board Assessment Appeals
Secs. 232-235 Rates of levy
Sec. 234 Exemption from real property tax
Sec. 237 Idle lands
Secs. 250-251 Payment of real property taxes and discounts
Sec. 252 Protest
Sec. 255 Interest on unpaid taxes
Sec. 270 Period to collect real property taxes

2. Cases

a. Lung Center of the Philippines v. Quezon City, G.R. No. 144104 dated
June 29, 2004 (Exemption based on actual use)

Page 19
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

b. Mactan Airport Authority v. Pres. Marcos, G.R. No. 120082 dated

September 11, 1996 (Exemption from real property tax lifted by RA
7160, or the LGC)

c. Manila International Airport authority v. Court of Appeals, G.R. No.

155650 dated July 20, 2006 (Exemption of RPT of MIAA)

d. Quezon City Gov’t. v. Bayantel Corp., G.R. No. 162015 dated March 6,
2006

e. Sta. Lucia Realty and Development, Inc. v. City of Pasig, G.R. No.
166838 dated June 15, 2011

f. Napocor v. Province of Lanao, GR 96700 dated November 19, 1996

g. Raul Sesbreno v. CBAA, GR 89252 dated May 24, 1993

h. Antonio Callanta v. Ombudsman, GR 115253-74 dated January 30, 1998

i. Belen Figuerres v. CA, GR 119172 dated March 25, 1999

IX. TARIFF AND CUSTOMS CODE

A. CONCEPT

1. The Tariff and Customs Code

2. The Bureau of Customs

Duties, power and jurisdiction

B. ARTICLES SUBJECT TO DUTY

1. Export (suspended except on logs) and import duties

2. Meaning of Importation (Sec. 1201, 1202)

3. Classes of Importation

a. Dutiable importation – Sec. 100

b. Prohibited importations – Secs. 101, 1207

c. Conditionally-free importation – Sec. 105

C. RATES OF DUTY

1. General Rules (Sec. 104)

2. Basis of Duty (Secs. 201, 202, 204, 205, 1308-1310, 1313)

Customs Administrative Order No. 2-96 dated June 14, 1996

Page 20
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

RA 8181 (transaction value), as amended by RA 9135

CAO No. 2-99, implementing RA 8181 on customs dutiable value and CAO No.
05-2001 implementing RA 9135

3. Special Duties

a. Dumping – Sec. 301

b. Countervailing – Sec. 302

c. Marking – Sec. 303

d. Discriminatory – Sec. 304

4. Flexible Tariff Rates (Sec. 401)

D. IMPOSITION OF DUTIES

1. Persons liable – Secs. 1203-1205

2. Declaration – Secs. 1302-1307

3. Examination, appraisal and classification – Secs. 1405-1408

Commissioner of Customs v. Marina Sales, Inc., G.R. No. 183868

4. Assessment of Taxes

5. Liquidation – Secs. 1601-1603

E. REMEDIES OF THE GOVERNMENT

1. Extrajudicial

a. Enforcement of Tax Lien – Sec. 1508

b. Seizure and Forfeiture – Secs. 2205, 2301-2316

2. Judicial

F. REMEDIES OF THE TAXPAYER

1. Refund – Secs. 1707-1708

2. Protest – Secs. 2308, 2310, 2309, 2312

3. Abandonment – Secs. 1801-1803

Page 21
Pamantasang Lungsod ng Maynila, College of Law
Taxation 2, Second Semester SY 2019-20
Atty. Bernadette V. Quiroz

4. Amendments by RA 9135 – Sec. 3514 (post entry audit); Sec. 3517 (compulsory
acquisition of grossly undervalued goods)

Commissioner of Customs v. AGFHA Incorporated, G.R. No. 187425 dated

March 28, 2011

Chevron Philippines, Inc. v. Commissioner of the Bureau of Customs, G.R. No.

178759 dated August 11, 2008

Page 22