Case Digest (G.R. No. 109289) Core Legal Reasoning Model
Facts:
On October 3, 1994, the Supreme Court, En Banc, consolidated two special civil actions filed by petitioner Rufino R. Tan (G.R. No. 109289) and Carag, Caballes, Jamora and Somera Law Offices, represented by Carlo A. Carag, Manuelito O. Caballes, Elpidio C. Jamora Jr. and Benjamin A. Somera Jr. (G.R. No. 109446), against respondents Secretary Ramon R. del Rosario Jr. and Commissioner Jose U. Ong. Petitioners, all taxpayers, sought prohibition to halt enforcement of Republic Act No. 7496, known as the Simplified Net Income Taxation Scheme (SNIT), which amended Sections 21 and 29 of the National Internal Revenue Code, and Section 6 of Revenue Regulations No. 2-93 issued pursuant thereto. In G.R. No. 109289, Tan argued that RA 7496 violated Article VI, Sections 26(1) and 28(1), and Article III, Section 1 of the 1987 Constitution by having a deficient title, lacking uniformity and equity, and depriving taxpayers of due process and equal protection. In G.R. No. 109446, petitioners con
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Case Digest (G.R. No. 109289) Expanded Legal Reasoning Model
Facts:
- Parties and Petitions
- Rufino R. Tan (G.R. No. 109289) and Carag, Caballes, Jamora & Somera Law Offices et al. (G.R. No. 109446) filed consolidated special civil actions for prohibition.
- Respondents are Ramon R. del Rosario, Jr., Secretary of Finance, and Jose U. Ong, Commissioner of Internal Revenue.
- Challenged Measures
- Republic Act No. 7496 (Simplified Net Income Taxation Scheme – SNIT), amending Sections 21 and 29 of the National Internal Revenue Code.
- Section 6, Revenue Regulations No. 2-93, implementing SNIT by applying it to general professional partnerships (GPP).
- Petitioner’s Contentions
- In G.R. No. 109289, RA 7496 violates:
- Art. VI, Sec. 26(1) – single subject rule.
- Art. VI, Sec. 28(1) – uniformity and equity in taxation.
- Art. III, Sec. 1 – due process and equal protection.
- In G.R. No. 109446, Revenue Regulations No. 2-93, Sec. 6, exceeds administrative rule-making authority by extending SNIT to GPPs.
- Legislative and Regulatory Provisions
- SNIT’s title: “An Act Adopting the Simplified Net Income Taxation Scheme for the Self-Employed and Professionals … Amending Sections 21 and 29 of the National Internal Revenue Code.”
- Section 21(f): imposes graduated net income tax with limited deductions.
- Section 29: restricts allowable deductions for SNIT taxpayers to specified direct costs or 40% of gross receipts.
- Section 23 (unaltered): GPP income is tax-exempt; partners are taxed individually on distributive shares.
Issues:
- Constitutional Validity of RA 7496
- Does RA 7496 violate the single-subject rule (Art. VI, Sec. 26(1))?
- Does RA 7496 breach the uniformity and equity requirement (Art. VI, Sec. 28(1))?
- Does RA 7496 infringe due process and equal protection (Art. III, Sec. 1)?
- Validity of Section 6, Revenue Regulations No. 2-93
- Did the Secretary of Finance and Commissioner of Internal Revenue exceed their rule-making authority by applying SNIT to general professional partnerships?
- Is the administrative interpretation contrary to legislative intent and existing Tax Code provisions?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)