taxation remedies for submission.ppt

8/14/2019 Taxation Remedies For Submission.ppt

1/48

Local Government Taxation

LOCAL GOVERNMENT TAXATIONREMEDIES


2/48

1. LIEN

2. CIVIL REMEDIESa. ADMINISTRATIVE ACTIONS

b. JUDICIAL ACTIONS

GOVERNMENT REMEDIES

Local Taxation - Government Remedies


3/48


A lien in its modern-acceptation is understood to denote a

legal claim or charge on property, either real or personal,as security for the payment of some debt or obligation.

(HSBC v Rafferty)

Definition:

Legal Basis:SEC. 173. Local Government's Lien. - Local taxes, fees,

charges and other revenues constitute a lien, superior toall liens, charges or encumbrances in favor of any person,

enforceable by appropriate administrative or judicial

action, not only upon any property or rights therein which

may be subject to the lien but also upon property used in

business, occupation, practice of profession or calling, or

exercise of privilege with respect to which the lien is

imposed. The lien may only be extinguished upon full

payment of the delinquent local taxes fees and charges

including related surcharges and interest

LIEN


4/48


Legal Basis:

SEC. 174. Civil Remedies. - The civil remedies for the

collection of local taxes, fees, or charges, and relatedsurcharges and interest resulting from delinquency shall be:

(a) By administrative action thru distraint of goods,

chattels, or effects, and other personal property of

whatever character, including stocks and other

securities, debts, credits, bank accounts, and

interest in and rights to personal property, and by

levy upon real property and interest in or rights

to real property;

Notice of sale to the delinquent land owners and to the

public in general is an essential and indispensable

requirement of law, the non-fulfillment of which invalidates

the sale (SERFINO v CA)

Jurisprudence:

CIVIL REMEDIES


5/48

DISTRAINT

Legal Basis:

Legal Basis:

CIVIL REMEDIES


SEC. 175., LGC Distraint of Personal Property

SEC. 176. Levy on Real Property


6/48

Seizure

Accounting

Publication

Sale

Disposition

D

IS

T

R

A

IN

T

Written Notice Certificate of Fact of Deliquency

Signed Account of Goods Submitted to Taxpayer

Public AuctionReport within 5 Days

After SaleIf not disposed within 120 days, sale

exhibited in not less than three (3) public and conspicuous

places in the territory of the local government unit

The proceeds of the sale shall be applied to satisfy the tax



7/48

AuthenticatedCertificate

Written Notice of

Levy to Assessor,ROD and Taxpayer

Within 10Days

Report of the

Levying Officer

LEVY

Treasurer, shall within thirty (30) days after

execution of the distraint, proceed with the levy

on the taxpayer's real property


After the expiration of the time required to pay the delinquent tax, fee,

or charge, real property may be levied


8/48

Local Taxation - Taxpayer's Remedies

What happens after the Levy

Levy Advertisementshall cover 30 days SaleTreasurer

issues a

Report

Issue

Certificate

If Payment

is made

prior to Sale

In case there

is no bidder


9/48

RedeemedWithin 1 year

Not Redeemed

Sale


What happens after the Sale


10/48

SEC. 185. Personal Property Exempt from Distraint or Levy

(a) Tools and the implements necessarily used by the delinquent taxpayer in

his trade or employment;

(b) One (1) horse, cow, carabao, or other beast of burden, such as the

delinquent taxpayer may select, and necessarily used by him in his ordinary

occupation;

(c) His necessary clothing, and that of all his family;

(d) Household furniture and utensils necessary for housekeeping and usedfor that purpose by the delinquent taxpayer, such as he may select, of a value

not exceeding Ten thousand pesos (P=10,000.00);

(e) Provisions, including crops, actually provided for individual or family use

sufficient for four (4) months;

(f) The professional libraries of doctors, engineers, lawyers and judges;

(g) One fishing boat and net, not exceeding the total value of Ten thousandpesos (P=10,000.00), by the lawful use of which a fisherman earns his

livelihood; and

(h) Any material or article forming part of a house or improvement of any real

property.



11/48

JUDICIAL

Real Property TaxationGovernment Remedies

Treasurer to

submit

certified

statement

ofdelinquency

Provincial

Atty file

civil actionMTC/RTC CTA SC

Legal Basis:

SEC. 183. Collection of Delinquent Taxes, Fees, Charges or

other Revenues through Judicial Action. - The local

government unit concerned may enforce the collection ofdelinquent taxes, fees, charges or other revenues by civil

action in any court of competent jurisdiction. The civil action

shall be filed by the local treasurer within the period

prescribed in Section 194 of this Code.


12/48


PRIOR TO ASSESSMENT:1.APPEAL TO THE SECRETARY OF JUSTICE

AFTER ASSESSMENT:

1. PROTEST ON ASSESSMENT OF LOCAL TAX

2. CLAIM OF REFUND OR TAX CREDIT


13/48


APPEAL TO SOJ

Section 187, LGC - That any question on the constitutionalityor legality of tax ordinances or revenue measures may be

raised on appeal within thirty (30) days from the effectivity

thereof to the Secretary of Justice who shall render a

decision within sixty (60) days from the date of receipt of the

appeal: Provided, however, That such appeal shall not havethe effect of suspending the effectivity of the ordinance and

the accrual and payment of the tax, fee, or charge levied

therein: Provided, finally, That within thirty (30) days after

receipt of the decision or the lapse of the sixty-day period

without the Secretary of Justice acting upon the appeal, the

aggrieved party may file appropriate proceedings with a

court of competent jurisdiction.

Legal Basis

N


14/48


Within 30

days from

effectivity

of

Ordinance

SECRETARY OF

JUSTICERTC

APPEAL TO SOJ

SC


15/48


Within 30

days from

effectivity

of

Ordinance

SECRETARY OF

JUSTICERTC

APPEAL TO SOJ

SC

ROC, RULE 45, Section 2. Time for filing; extension.The petition shall be filed

within fifteen (15) days from notice of the judgment or final order or resolution

appealed from, or of the denial of the petitioner's motion for new trial orreconsideration filed in due time after notice of the judgment. On motion duly filed

and served, with full payment of the docket and other lawful fees and the deposit for

costs before the expiration of the reglementary period, the Supreme Court may for

justifiable reasons grant an extension of thirty (30) days only within which to file the

petition.


16/48


Legal Basis

Section 195 Protest of Assessment. - When the local treasurer or his dulyauthorized representative finds that correct taxes, fees, or charges have

not been paid, he shall issue a notice of assessment stating the nature of

the tax, fee or charge, the amount of deficiency, the surcharges, interests

and penalties. Within sixty (60) days from the receipt of the notice of

assessment, the taxpayer may file a written protest with the local

treasurer contesting the assessment; otherwise, the assessment shallbecome final and executory. The local treasurer shall decide the protest

within sixty (60) days from the time of its filing. If the local treasurer finds

the protest to be wholly or partly meritorious, he shall issue a notice

canceling wholly or partially the assessment. However, if the local

treasurer finds the assessment to be wholly or partly correct, he shall

deny the protest wholly or partly with notice to the taxpayer. Thetaxpayer shall have thirty (30) days from the receipt of the denial of the

protest or from the lapse of the sixty (60) day period prescribed herein

within which to appeal with the court of competent jurisdiction

otherwise the assessment becomes conclusive and unappealable.

PROTEST ON ASSESSMENT OF LOCAL TAX


17/48


PROTEST ON ASSESSMENT OF LOCAL TAX

Local

Treasurer

Grants DeniesFails to

Decide

MTC/RTC CTA SC


18/48


Legal Basis:

Jurisprudence:

CLAIM OF REFUND

SEC. 196. Claim for Refund of Tax Credit. - No case or proceeding

shall be maintained in any court for the recovery of any tax, fee,or charge erroneously or illegally collected until a written claim

for refund or credit has been filed with the local treasurer. No

case or proceeding shall be entertained in any court after the

expiration of two (2) years from the date of the payment of such

tax, fee, or charge, or from the date the taxpayer is entitled to a

refund or credit.

TOLEDO V METRO MANILA: Based on Section 196 of R.A. No. 7160,

there are two requisites for a refund claim or tax credit of local taxes,

namely: (1) a written claim for refund or credit must be filed with thelocal treasurer before filing an action for refund with the appropriate

court; (2) the refund claim or tax credit must be filed before the court

within two (2) years from the date of payment of the tax, fee or charge .


19/48


Local Treasurer

Written

Claim for

Refund

CLAIM OF REFUND

Grants DeniesFails to

Decide

MTC/RTC CTA SC

Payment of taxwhen erroneously

charged or illegally

collected


20/48

Real Property Taxation - Remedies

REAL PROPERTY TAXATIONREMEDIES


21/48

1. LIEN

2. CIVIL REMEDIES

a. ADMINISTRATIVE ACTIONS

b. JUDICIAL ACTIONS


REAL PROPERTY TAXATION REMEDIES

GOVERNMENT REMEDIES


22/48

LIEN


Legal Basis

SEC. 257. Local Governments Lien. - The basic real

property tax and any other tax levied under this

Title constitutes a lien on the property subject to

tax, superior to all liens, charges or

encumbrances in favor of any person,irrespective of the owner or possessor thereof,

enforceable by administrative or judicial action,

and may only be extinguished upon payment of

the tax and the related interests and expenses.


23/48

Notice andPublication of

Delinquency

Issue Warrant ofLevy

Report of Levying

Officer10 days after receipt

of warrant by taxpayer

Public

Advertisement by

posting and

publication


LEVY

Legal Basis: SEC. 258. Levy on Real Property

Assessor and

ROD toannotate

Issue

Warrant of

Levy


24/48


What happens after the Levy

LevyAdvertisement

Posting and

Publication

SaleTreasurer

issues a

Report

Issue

Certificate

If Payment

is made

prior to Sale

In case thereis no bidder


25/48


26/48

JUDICIAL


Treasurer to

submit

certified

statement

ofdelinquency

Provincial

Atty file

civil actionMTC/RTC CTA SC

Legal Basis:

SEC. 256. Remedies For The Collection Of Real Property Tax.

- For the collection of the basic real property tax and any

other tax levied under this Title, the local government unit

concerned may avail of the remedies by administrative

action thru levy on real property or by judicial action.


27/48

Real Property TaxationTaxpayers Remedies

1. Protest on assessment of Land

Value

2. Protest on Assessment/Collection ofReal Property


28/48

PROTEST ON ASSESSMENT OF LAND VALUE


Assessment

Notice

File verified

Petition 60

Days afterNotice

Meralco v Barlis

For purposes of giving effect to such assessment, it is

deemed made when the notice is released, mailed or sent to

the taxpayer. As soon as the notice is duly served, an

obligation arises on the part of the taxpayer to pay the

amount assessed and demanded.


29/48



Assessment

NoticeLBAA

30 Days

Meralco v Barlis

JURISDICTION OF LOCAL BOARDS OFASSESSMENT APPEALS:

The Local Board shall have the ORIGINAL

jurisdiction to hear and decide appeals of

owners/administrators of real property from the

action of the Provincial or City Assessors, or the

Municipal Assessors in the Metro Manila Area,in the assessment of their real properties, and

from the action of the Provincial or Municipal

Treasurers in the Metro Manila Area, regarding

the collection of real property taxes, special

levies, or other real property taxes under Title

Two, Book Two, RA 7160LBAA shall decide within 120 days


30/48



Assessment

NoticeLBAA CBAA

Petition for Review

30 Days

JURISDICTION OF THE CENTRAL BOARD OF ASSESSMENT APPEALS:

The Central Board shall have exclusive jurisdiction to

hear and decide all appeals from the decisions, order

and resolutions of the Local Boards involving contestedassessments of real properties, claims for tax refund

and/or tax credits or overpayment of taxes

If the taxpayer fails to appeal in due

course, the right of the local

government to collect the taxes due

becomes absolute upon the

expiration of such period, with

respect to the taxpayersproperty


31/48



Assessment

NoticeLBAA CBAA

CTA

en banc

A judgment or ruling of the Regional Trial Court acting in its

original jurisdiction on tax cases may be appealed to the Court in

Division within a period of thirty (30) days from receipt thereof,

pursuant to Section 9 of Republic Act ('R.A.') No. 9282

JURISDICTION OF COURT OF TAX APPEALS (en banc), RCTA,

Rule 4, Sec 2(e) Decisions of the CBAA in the exercise of its

appellate jurisdiction over cases involving the assessment and

taxation of real property originally decided by the provincial or city

board of assessment appeals

Petition for Review

on Certiorari 15Days


32/48



Assessment

Notice

LBAAshall decide

within 120

days

CBAA CTA SC

SEC. 226. Local Board of Assessment Appeals. - Any owner or person having

legal interest in the property who is not satisfied with the action of the

provincial, city or municipal assessor in the assessment of his property may,within sixty (60) days from the date of receipt of the written notice of

assessment, appeal to the Board of Assessment appeals of the province or

city by filing a petition under oath in the form prescribed for the purpose,

together with copies of the tax declarations and such affidavits or

documents submitted in support of the appeal.

Legal Basis:


33/48

PROTEST ON ASSESSMENT OF REAL ESTATE PROPERTY TAX

Payment

Under

Protest


Protest

30 Days

Section 252, LGC


34/48

Treasurer

decides

Grants Denies

Apply as Tax

Credit forfuture liability


Fails to

Decide


Payment

Under

Protest

Treasurer has

60 days todecide

Appeal

within 60

days


35/48

Treasurer

decidesLBAA



Payment

Under

Protest

Appeal within

30 days


36/48

Treasurer

decidesLBAA CBAA



Payment

Under

Protest

Petition for Review

30 days


37/48

Treasurer

decideswithin 60 days

LBAA CBAA



CTA SC

Payment

Under

Protest

Legal Basis:

SEC. 252. Payment Under Protest. - (a) No protest shall be entertained unless the taxpayer first pays

the tax. There shall be annotated on the tax receipts the words "paid under protest". The protest in

writing must be filed within thirty (30) days from payment of the tax to the provincial, city treasurer

or municipal treasurer, in the case of a municipality within Metropolitan Manila Area, who shall

decide the protest within sixty (60) days from receipt.

(b) The tax or a portion thereof paid under protest, shall be held in trust by the treasurer concerned.(c) In the event that the protest is finally decided in favor of the taxpayer, the amount or portion of

the tax protested shall be refunded to the protestant, or applied as tax credit against his existing or

future tax liability.

(d) In the event that the protest is denied or upon the lapse of the sixty day period prescribed in

subparagraph (a), the taxpayer may avail of the remedies as provided for in Chapter 3, Title II, Book II

of this Code.


38/48

Treasurer

decidesLBAA CBAA

TAX REFUND


CTA SCClaim for

Refund

Legal Basis:

SEC. 253. Repayment of Excessive Collections. - When an assessment of basic real

property tax, or any other tax levied under this Title, is found to be illegal or

erroneous and the tax is accordingly reduced or adjusted, the taxpayer may file a

written claim for refund or credit for taxes and interests with the provincial or city

treasurer within two (2) years from the date the taxpayer is entitled to such

reduction or adjustment. The provincial or city treasurer shall decide the claim for

tax refund or credit within sixty (60) days from receipt thereof. In case the claim for

tax refund or credit is denied, the taxpayer may avail of the remedies as provided in

Chapter 3, Title II, Book II of this Code.


39/48


LEVY v LIEN

Tax Lien is the government's statutory right that encumbers property to secure the

ultimate payment of a tax.

The term "levy" in this narrow technical sense denotes an administrative actionby

the proper government agency (i.e., without going to court) to seize property tosatisfy a tax liability. The levy is the actual act of seizure of the property.


40/48


SEC. 226. Local Board of Assessment Appeals

vs

SEC. 195. Protest of Assessment

Assessment referred to in Sec 226 pertains to the valuation made by

the local assessor on a real property for realty tax purposes. The

appeal process is via LBAA ->CBAA

On the other hand, Sec 195 refers to the notice of assessment that the

local treasurers are required to issue upon a local tax, fee or charge

becoming delinquent. Aggrieved party may file a written protest to the

local treasurer. If the protest is denied, taxpayer may appeal to courts

of competent jurisdiction


41/48


Assessment in Sec 194

vs

Assessment in Sec 195

Assessment mentioned in Sec 194 refers to the

determination of the amount of tax base as basis for

computing tax due, which may either be by self-

assessment of the taxpayer or assessment by thetreasurer

If the assessment is by the treasurer, he is required to

issue the Notice of Assessment on the taxpayerpursuant to Sec 195, otherwise the taxes due

prescribe after 5 years from such assessment.


42/48


Effect of Appeal on Collection of Taxes

An Appeal shall not suspend the collection of the

corresponding realty taxes on the real property subject of

the appeal as assessed by the assessor concerned

without prejudice to subsequent adjustment dependingon the final outcome of the appeal.


43/48


It was an ill-advised move for Napocor to directly file an appeal with the LBAA

under Section 226 without first paying the tax as required under Section 252.

Sections 252 and 226 provide successive administrative remedies to a

taxpayer who questions the correctness of an assessment. Section 226, in

declaring that "any owner or person having legal interest in the property who

is not satisfied with the action of the provincial, city, or municipal assessor in

the assessment of his property may x x x appeal to the Board of Assessment

Appeals x x x," should be read in conjunction with Section 252 (d), which

states that "in the event that the protest is denied x x x, the taxpayer may avail

of the remedies as provided for in Chapter 3, Title II, Book II of the LGC

[Chapter 3 refers to Assessment Appeals, which includes Sections 226 to

231]. The "action" referred to in Section 226 (in relation to a protest of realproperty tax assessment) thus refers to the local assessorsact of denying the

protest filed pursuant to Section 252. Without the action of the local assessor,

the appellate authority of the LBAA cannot be invoked. Napocors action

before the LBAA was thus prematurely filed.

Sec 252, LGC: PAYMENT UNDER PROTEST

General Rule

NAPOCOR v QUEZON


44/48


Sec 252, LGC: PAYMENT UNDER PROTEST

EXCEPTION: Where the petitioners are questioning the very

power of the assessor to impose the assessment, and/or the

authority of the treasurer to collect the tax as these involve

questions of law and not of fact, hence, not appealable to

LBAA


45/48


It was an ill-advised move for Napocor to directly file an appeal with the LBAA

under Section 226 without first paying the tax as required under Section 252.

Sections 252 and 226 provide successive administrative remedies to a

taxpayer who questions the correctness of an assessment. Section 226, in

declaring that "any owner or person having legal interest in the property who

is not satisfied with the action of the provincial, city, or municipal assessor in

the assessment of his property may x x x appeal to the Board of Assessment

Appeals x x x," should be read in conjunction with Section 252 (d), which

states that "in the event that the protest is denied x x x, the taxpayer may avail

of the remedies as provided for in Chapter 3, Title II, Book II of the LGC

[Chapter 3 refers to Assessment Appeals, which includes Sections 226 to

231]. The "action" referred to in Section 226 (in relation to a protest of realproperty tax assessment) thus refers to the local assessorsact of denying the

protest filed pursuant to Section 252. Without the action of the local assessor,

the appellate authority of the LBAA cannot be invoked. Napocors action

before the LBAA was thus prematurely filed.

NAPOCOR v QUEZON


46/48


Sangguniang Panglungsod of the City of Makati, et al vs. Chevron Holdings, Inc., CTA

AC No. 70, October 21, 2011 & Res. Dec. 26, 2011

The issue of constitutionality or unconstitutionality of a localordinance may be invoked as a ground to protest the assessment

under Section 195 of the Local Government Code (LGC).

The City Assessors Office assessed the taxpayer for business taxes

pursuant to the Revised Makati Revenue Code (RMRC). Taxpayer filed

a protest which was later denied by the City Treasurer. The taxpayerfiled an appeal before the RTC. The City of Makati argued that

although the taxpayer used the protest against the assessment as

basis of its appeal before the RTC, the latter was actually questioning

the legality of the provision of RMRC. The City asserts that the issue of

constitutionality or unconstitutionality of a local ordinance may not beinvoked as a ground to protest assessment under Section 195 of the

LGC. The Court held that Section 195 of LGC does not enumerate nor

restrict a protest of assessment to specific grounds; thus, respondent

has the right to raise as an issue the constitutionality of the tax

ordinance, which became the sole basis of the disputed assessment


47/48


Local Tax; Notice of Garnishment deemed denial of protest. Claim for refund

not sine qua non to right toappeal; Franchise tax; Bureau of LocalGovernment Finance Opinions.

Jurisprudence dictates that a final letter for payment of delinquent taxes may

be considered a decision on a disputed or protested assessment. Hence,

the issuance of notice of Garnishment is deemed a denial of respondents

protest; The Supreme court ruled in Vda. De San Agustin vs. CIR that to

require the taxpayer to claim for refund of the taxes paid as a condition

precedent to his right to appeal, would in effect require him to go through a

useless and needless ceremony that would only delay the disposition of the

case, for the Commissioner would certainly disallow the claim for refund in

the same way, as he disallowed the protest again the assessment; Taxpayer

is not liable to pay franchise tax to the province on gross receipts realized

within the city (that is within the territory of the province); BLGF s

interpretation of local tax laws in not authoritative and persuasive. It has not

express powers to interpret the tax code and other national laws, unlike the

Commissioner of Internal Revenue. Section 195, 196, 137 and 151 of the

Local government Code.

Province of Cagayan v. Philippine Long Distance Telephone

Company, C.T.A. AC No. 63 (RTC Civil Case No. 07-077), September 15, 2010


48/48

END

taxation remedies for submission.ppt

Documents