ORMOC SUGAR COMPANY, INC., plaintiff-appellant, vs. THE
TREASURER OF ORMOC CITY, THE MUNICIPAL BOARD OF ORMOC CITY, HON.
ESTEBAN C. CONEJOS as Mayor of Ormoc City and ORMOC CITY,
defendants-appellees. G.R. No. L-23794. February 17, 1968. 20 SCRA
739.FACTS:
The Municipal Board of Ormoc City passed Ordinance No. 4,
imposing "on any and all productions of sugar milled at
petitioner's, municipal tax of 1% per export sale. Petitioner paid
but were under protest.
Petitioner filed before the CFI contending that the ordinance is
unconstitutional for being in violation of the equal protection
clause and the rule of uniformity of taxation, aside from being an
export tax forbidden under Section 2287 of the Revised
Administrative Code. It further alleged that the tax is neither a
production nor a license tax which Ormoc City its charter and under
Section 2 of Republic Act 2264, or the Local Autonomy Act, is
authorized to impose; that it also violates RA 2264 because the tax
is on both the sale and export of sugar.
ISSUE: Whether the ordinance is valid.
RULING:
NO. The SC held that it violates the equal protection clause for
it taxes only sugar produced and exported by petitioner and none
other. Even though petitioner, at the time of the enactment of the
ordinance, was the only sugar central in Ormoc, the classification
should have been in terms applicable to future conditions as well.
The taxing ordinance should not be singular and exclusive as to
exclude any subsequently established sugar central, of the same
class as petitioner, for the coverage of the tax.
Though, petitioner can be refunded, they are not entitled to
interest because the taxes were not arbitrarily collected as the
ordinance provided a sufficient basis to preclude arbitrariness,
the same being then presumed constitutional until declared
otherwise.
