Title
Alta Vista Golf and Country Club vs. City of Cebu
Case
G.R. No. 180235
Decision Date
Jan 20, 2016
A non-profit golf club challenges Cebu City's amusement tax on golf courses, arguing it exceeds LGC authority; SC rules tax invalid, orders refund.
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Case Digest (G.R. No. 180235)

Facts:

Subject Matter: The case involves a Petition for Review on Certiorari filed by Alta Vista Golf and Country Club (petitioner) against the City of Cebu, its Mayor, and City Treasurer (respondents) regarding the imposition of amusement tax on its golf course.

Background:

  1. Petitioner’s Operation: Alta Vista Golf and Country Club is a non-stock, non-profit corporation operating a golf course in Cebu City.
  2. Tax Ordinance: On June 21, 1993, Cebu City enacted City Tax Ordinance No. LXIX, which included Section 42 imposing amusement tax on various establishments, including golf courses at a rate of 20%. This was later amended by City Tax Ordinance Nos. LXXXII and LXXXIV.
  3. Tax Assessment: In 1998, petitioner was assessed deficiency business taxes, including amusement tax amounting to P2,612,961.24 based on gross receipts from its golf course. Petitioner refused to pay, arguing that Section 42 was illegal since amusement tax under the Local Government Code (LGC) could only be imposed on theaters, cinemas, and similar places, not golf courses.
  4. Continued Dispute: Despite repeated demands, petitioner refused to pay, leading to a Closure Order issued by the City Mayor in December 2005 for operating without a business permit and nonpayment of taxes.

Legal Proceedings:

  1. RTC Petition: Petitioner filed a Petition before the RTC seeking to nullify the Closure Order, assessment, and Section 42 of the tax ordinance. The RTC dismissed the petition, citing procedural lapses, including failure to exhaust administrative remedies under Section 187 of the LGC.
  2. Payment Under Protest: Petitioner later paid the amusement tax under protest but maintained its position that the tax was illegal.

Issue:

  1. Whether the power of judicial review over the validity of a local tax ordinance has been restricted by Section 187 of the LGC.
  2. Whether the City of Cebu or any local government unit can validly impose amusement tax on golf courses.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)


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