Case Summary (G.R. No. 202324)
Definition and Exception of Percentage Taxes
Under Section 133(i) of the LGC, LGUs are generally barred from levying percentage or value-added taxes on sales or services “except as otherwise provided” in the Code. The Court recognized amusement taxes as percentage taxes, measured by a percentage of gross receipts. However, Section 140 of the LGC specifically authorizes provinces to levy an amusement tax—up to 30%—on “theaters, cinemas, concert halls, circuses, boxing stadia, and other places of amusement.”
Ejusdem Generis and “Other Places of Amusement”
To determine whether resorts and similar venues fall under “other places of amusement,” the Court applied the principle of ejusdem generis. General terms following a list of specific items are confined to things akin to those items. The statutory definition in Section 131(c) of the LGC clarifies that “amusement places” are venues “where one seeks admission to entertain oneself by seeing or viewing the show or performances.” These places share the characteristic of hosting spectacles or performances for an audience.
Inapplicability to Resorts, Swimming Pools, Bath Houses, Hot Springs, and Tourist Spots
Resorts, swimming pools, bath houses, hot springs, and tourist spots do not primarily serve as venues for staged shows or performances. Although they may provide recreational or visual engagement, they lack the core characteristic of presenting spectacles to an audience. Therefore, they fall outside the scope of “other places of amusement” under Section 140 of the LGC.
Validity of Tax on Boxing Stadia and Traditional Amusements
The Court noted that the second paragraph of Section 59, Article X of the Benguet Code also includes a 10% tax on boxing admissions. Since “boxing stadia” are expressly covered by Section 140 of the LGC, the imposition of amusement tax on boxing remains valid. The first paragraph of Sec
...continue readingCase Syllabus (G.R. No. 202324)
Procedural History
- Petition for Review on Certiorari under Rule 45 filed by Pelizloy Realty Corporation (Pelizloy) challenging the December 10, 2007 Decision of the Regional Trial Court (RTC), Branch 62, La Trinidad, Benguet, in Civil Case No. 06-CV-2232.
- RTC decision dismissed Pelizloy’s Petition for Declaratory Relief and Injunction, ruling Section 59, Article X of the Benguet Provincial Revenue Code of 2005 (“Tax Ordinance”) valid and declaratory relief a proper remedy.
- Motion for Reconsideration denied by RTC on May 21, 2008.
- Present petition filed on June 10, 2008, raising pure questions of law.
Facts
- Petitioner Pelizloy Realty Corporation owns and operates Palm Grove Resort in Asin, Angalisan, Municipality of Tuba, Benguet, offering recreation facilities (swimming pools, spa, function halls).
- Benguet Provincial Board enacted Provincial Tax Ordinance No. 05-107 (Benguet Revenue Code of 2005) effective January 1, 2006, imposing:
• 30% amusement tax on gross receipts from admission fees for theaters, cinemas, concert halls, circuses, cockpits, dancing halls/schools, night/day clubs, and other places of amusement;
• 10% amusement tax on gross receipts from admission fees for boxing, resorts, swimming pools, bath houses, hot springs, and tourist spots. - Pelizloy filed an appeal with the Secretary of Justice under Section 187, LGC, which was deemed denied after 60 days, then filed a Petition for Declaratory Relief and Injunction before the RTC.
Issues
- Whether Section 59, Article X of the Benguet Revenue Code of 2005 levies a percentage tax prohibited by Section 133(i) of the Local Government Code (LGC).
- Whether provinces may validly impose amusement taxes on admission fees to resorts, swimming pools, bath houses, hot springs, and tourist spots as “other places of amusement” under Section 140, LGC.
Applicable Legal Provisions
- 1987 Cons