G.R. No. 203961 - People vs. Licayan

On February 14, 1963, Pepsi-Cola Bottling Company of the Philippines, Inc. filed a complaint with preliminary injunction in CFI Leyte seeking to declare Section 2 of R.A. 2264 unconstitutional and Ordinances Nos. 23 and 27 of Tanauan, Leyte null and void.
On July 23, 1963, the parties stipulated that both ordinances covered the same subject (municipal production tax) with similar rates, and that on January 17, 1963 the Acting Municipal Treasurer sought to enforce Ordinance No. 27 against Pepsi-Cola.

Ordinance No. 23 (approved September 25, 1962) imposed a “municipal production tax” of one-sixteenth (1/16) centavo per corked bottle of soft drink, payable upon monthly submission of total bottles produced and corked.
Ordinance No. 27 (approved October 28, 1962) imposed a “municipal production tax” of one centavo (P0.01) per gallon (128 fl. oz.) of soft drink produced, payable upon monthly submission of total gallons produced; it contained a provision repealing inconsistent ordinances.

On October 7, 1963, the CFI of Leyte dismissed the complaint, upheld the constitutionality of Section 2, R.A. 2264, declared Ordinances Nos. 23 and 27 valid, and ordered Pepsi-Cola to pay the taxes due and costs.
Pepsi-Cola appealed to the Court of Appeals, which elevated the case to the Supreme Court, presenting only pure questions of law.

Whether Section 2 constitutes an undue delegation of taxing power and is oppressive or confiscatory.