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FINALS 03.06A - REMEDIES OF LOCAL GOVERNMENT & TAXPAYER A. REMEDIES…

- - - - 4. SUMMARY REMEDIES
        
        a. DISTRAINT OF PERSONAL PROP
        
        b. LEVY ON REAL PROPERTY
        
        c. FURTHER DISTRAINT AND LEVY
        
        REPEAT DISTRAINT & LEVY :check:
        
        FULL AMOUNT
        
        EXPENSES
        SECTION 184. Further Distraint or Levy. – The remedies by distraint and levy may be repeated if necessary until the full amount due, including all expenses, is collected.
        
        RP MAY BE LEVIED AHEAD OF PP
        SECTION 176. Levy on Real Property. –
        After the expiration of the time required to pay the delinquent tax, fee, or charge, real property may be levied on before, simultaneously, or after the distraint of personal property belonging to the delinquent taxpayer.
        
        CERTIFICATE:
        
        NAME OF TP
        
        AMOUNT OF TAX/PENALTY
        To this end, the provincial, city or municipal treasurer, as the case may be, shall prepare a duly authenticated certificate showing the name of the taxpayer and the amount of the tax, fee, or charge, and penalty due from him.
        
        CERTIFICATE = LEGAL EXECUTION
        Said certificate shall operate with the force of a legal execution throughout the Philippines.
        
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        WITHIN 30D-LEVY -> 30D-ADVERTISE
        SECTION 178. Advertisement and Sale. –
        Within thirty (30) days after the levy, the local treasurer shall proceed to publicly advertise for sale or auction the property or a usable portion thereof as may be necessary to satisfy the claim and cost of sale; and such advertisement shall cover a period of at least thirty (30) days.
        
        NOTICE POSTED AT:
        
        MAIN ENTRANCE OF
        a. MUNI/CITY HALL
        
        CONSPI PUBLIC PLACE
        a. RP'S LOCATION
        
        3 WEEKS
        a. GEN CIRCULATION IN PROVINCE
        It shall be effected by posting a notice at the main entrance of the municipal building or city hall, and in a public and conspicuous place in the barangay where the real property is located, and by publication once a week for three (3) weeks in a newspaper of general circulation in the province, city or municipality where the property is located.
        
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        1-YEAR REDEMPTION
        
        FULL PRICE
        
        2% PER MONTH
        SECTION 179. Redemption of Property Sold. – Within one (1) year from the date of sale, the delinquent taxpayer or his representative shall have the right to redeem the property upon payment to the local treasurer of the total amount of taxes, fees, or charges, and related surcharges, interests or penalties from the date of delinquency to the date of sale, plus interest of not more than two percent (2%) per month on the purchase price from the date of purchase to the date of redemption. Such payment shall invalidate the certificate of sale issued to the purchaser and the owner shall be entitled to a certificate of redemption from the provincial, city or municipal treasurer or his deputy.
        
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        DISTRAINT REQS:
        
        LOCAL TREASURER/DEPUTY
        
        WRITTEN NOTICE
        
        PERSONAL PROPERTY
        a. BELONGING
        b. LIEN-SUBJECT
        SECTION 175. Distraint of Personal Property. – The remedy by distraint shall proceed as follows:
        
        (a) Seizure – Upon failure of the person owing any local tax, fee, or charge to pay the same
        at the time required,
        the local treasurer or his deputy may,
        upon written notice,
        seize or confiscate
        ANY personal property belonging to that person or ANY personal property subject to the lien in sufficient quantity
        
        ACCOUNT:
        
        EXECUTING OFFICER MAKES/CAUSE
        
        SIGNED COPY
        a. LEFT WITH
        -OWNER
        -PERSON TAKEN FROM
        -DWELLING/BUSINESS + PERSON AGED & DISCRETION
        (b) Accounting of distrained goods. –
        The officer executing the distraint shall
        make or cause to be made an
        account of the goods, chattels or effects distrained, a copy of which signed by himself shall be left
        
        either with
        the owner or
        person from whose possession the goods, chattels or effects are taken,
        or
        at the dwelling or place of business of that person and with someone of suitable age and discretion,
        to which list shall be added a statement of the
        sum demanded and a
        note of the time and place of sale.
        
        NOTICE:
        
        3 PUBLIC & CONSPI PLACES
        a. 1 at OFFICE OF CHIEF EXEC
        b. LGU WHERE DISTRAINT IS MADE
        c. SPECIFY
        -TIME & PLACE OF SALE
        -ARTICLES DISTRAINED
        (c) Publication –
        The officer shall forthwith cause a notification to be exhibited in not less than three (3) public and conspicuous places in the territory of the local government unit where the distraint is made, specifying the time and place of sale, and the articles distrained.
        
        PAY BEFORE DISTRAINT -> NO DISTRAINT
        (d) Release of distrained property upon payment prior to sale –
        If at any time prior to the consummation of the sale, all the proper charges are paid to the officer conducting the sale, the goods or effects distrained shall be restored to the owner.
        
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        SALE
        AFTER! 20D-NOTICE & PUBLICATION
        The time of sale shall not be less than twenty (20) days after notice to the owner or possessor of the property as above specified and the publication or posting of the notice.
        
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        SATISFIES:
        
        TAX/FEE/CHARGE
        
        INCREMENT
        
        EXPENSES of SEIZURE
        to satisfy the tax, fee, or charge in question,
        together with any increment thereto incident to delinquency and the expenses of seizure.
        
        DEFICIENCY -> CERTIFICATE
        In such case, the local treasurer or his deputy shall issue a duly authenticated certificate based upon the records of his office showing the fact of delinquency and the amounts of the tax, fee, or charge and penalty due.
        
        CERTIFICATE = WARRANT
        Such certificate shall serve as sufficient warrant for the distraint of personal property aforementioned,...
        
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        PUBLIC AUCTION
        Distrained personal property shall be sold at public auction in the manner herein provided for.
        
        5. JUDICIAL REMEDY (COLLECTION)
        
        COURT
        SECTION 183. Collection of Delinquent Taxes, Fees, Charges or other Revenues through Judicial Action. –
        The local government unit concerned may enforce the collection of delinquent taxes, fees, charges or other revenues by civil action in any court of competent jurisdiction.
        
        WHO FILES:
        LOCAL TREASURER
        The civil action shall be filed by the local treasurer within the period prescribed in Section 194 of this Code.
      - TAXES/FEES/CHARGES:
        ONE-TIME: 25% UNPAID TAXES
        PER MONTH: 2% OF UNPAID + SURCHARGE
        SECTION 168. Surcharges and Penalties on Unpaid Taxes, Fees, or Charges. –
        The sanggunian may impose a surcharge not exceeding twenty-five (25%) of the amount of taxes, fees or charges not paid on time
        and
        an interest at the rate not exceeding two percent (2%) per month of the unpaid taxes, fees or charges including surcharges,
        until such amount is fully paid...
        
        DUES: (OCE)
        PER MONTH: 2%
        SECTION 169. Interests on Other Unpaid Revenues. –
        Where the amount of any other revenue due a local government unit, except voluntary contributions or donations, is not paid on the date fixed
        
        ORDINANCE
        in the ordinance, or
        
        CONTRACT
        in the contract, expressed or implied, or
        
        EVENT
        upon the occurrence of the event which has given rise to its collection,
        
        there shall be collected as part of that amount an interest thereon at the rate not exceeding two percent (2%) per month from the date it is due until it is paid,
        
        36 MONTHS MAX
        but in no case shall the total interest on the unpaid amount or a portion thereof exceed thirty-six (36) months.
        
        EXCEPT:
        
        VOLUNTARY CONTRIBUTIONS
        
        DONATIONS
        
        36 MONTHS MAX
        ...but in no case shall the total interest on the unpaid amount or portion thereof exceed thirty-six (36) months.
    - - FRAUD/INTENT TO EVADE -> 10YRS-DISC
        (b) In case of fraud or intent to evade the payment of taxes, fees, or charges, the same may be assessed within ten (10) years from discovery of the fraud or intent to evade payment.
      - COLLECTION PRESCRIPTION
        5 YRS-ASSESSMENT
        (c) Local taxes, fees, or charges may be collected within five (5) years from the date of assessment by administrative or judicial action. No such action shall be instituted after the expiration of said period:
        
        PRIOR EFFECTIVITY, 3 YRS
        Provided, however, That taxes, fees or charges assessed before the effectivity of this Code may be collected within a period of three (3) years from the date of assessment.
      - TAXES PRIOR EFFECTIVITY -> 3YRS-DUE
        Provided, That taxes, fees or charges which have accrued before the effectivity of this Code may be assessed within a period of three (3) years from the date they became due.
    - - 60D-RECEIPT
        PROTEST
        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 shall become final and executory.
        
        60D-FILE
        DECIDE PROTEST
        The local treasurer shall decide the protest within sixty (60) days from the time of its filing.
        
        MERIT MAY BE:
        WHOLE or PARTIAL
        If the local treasurer finds the protest to be wholly or partly meritorious, he shall issue a notice cancelling wholly or partially the assessment.
        
        DENIAL MAY BE
        WHOLE or PARTIAL
        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.
        
        30D-DENIAL/LAPSE
        APPEAL
        The taxpayer 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.
        
        30 DAYS FROM DENIAL/LAPSE, APPEAL TO:
        
        100K-400K MTC
        
        ABOVE 400K-1M RTC
        
        See (this important case) City of Manila v. Cosmos Bottling Corporation, G.R. No. 196681, June 27, 2018, 868 SCRA 419, 439-449, where the City of Manila assessed Cosmos for the first quarter of 2017 local business taxes and regulatory fees in the total amount of Php1,226,781.05.
        Cosmos protested the assessment, arguing that the tax ordinance pursuant to which the City of Manila imposed the said local business taxes and regulatory fees had earlier been declared by the Supreme Court null and void for failure to comply with the required publication for three (3) consecutive days.
        Cosmos further argued that the local business tax being collected constitutes double taxation since Cosmos was made liable to pay the business tax twice,
        first as a manufacturer under
        Section 14 of the ordinance, and then, again, under
        Section 21 of the same ordinance.
        Pressured to obtain renewal of its mayor’s permit for the year 2007, Cosmos offered to pay only Php 131,994.23, which it believed was the correct computation of its local business tax for the first quarter of 2007.
        The City Treasurer, however, rejected the offer and, at the same time, denied Cosmos’s protest in a letter that Cosmos received on February 6, 2007.
        This constrained Cosmos to pay the assessment of Php1,226,781.05 on February 13, 2007.
        On March 1, 2007, Cosmos filed with the City Treasurer a claim for refund of the amount of Php1,094,786.82 (after deducting the Php131,994.23 which it believed was the only amount of local business tax due from it), raising the same grounds stated in its protest.
        
        On March 8, 2007, or exactly thirty (30) days from its receipt of the denial of its protest, Cosmos filed a complaint with the Regional Trial Court of Manila for the refund or issuance of tax credit certificate in the amount of Php1,094,786.82.
        The City of Manila moved to dismiss the complaint filed with the RTC on the ground of lack of jurisdiction since Cosmos’s remedy was to appeal the denial of its protest within 30 days to a court of competent jurisdiction, which Cosmos failed to do, rather than file a claim for tax refund or tax credit of illegally/erroneously paid taxes.
        The Regional Trial Court ruled in favor of Cosmos but denied the claim for refund. The Regional Trial Court likewise denied Cosmos’s motion for reconsideration, prompting Cosmos to appeal to the Court of Tax Appeals.
        The Court of Tax Appeals in Division ruled in favor of Cosmos’s allegation of double taxation while, at the same, affirming that the increased rates under the ordinances in question had indeed been declared null and void, and that Cosmos’s liability for business taxes for calendar year 2007 must be computed based on the gross sales or receipts for the preceding calendar year 2006, not 2005.
        The Court of Tax Appeals in Division thus ordered the City of Manila to refund or issue a tax credit certificate to Cosmos in the claimed amount of Php1,094,786.82.
        
        PROTEST & PAY NOW, ACTION LATER
        On appeal, the Supreme Court held that a taxpayer who had protested and paid an assessment is not precluded from later instituting an action for refund or credit.
        The taxpayer’s remedies of protesting an assessment and refund of taxes are stated in Sections 195 and 196 of the LGC.
        
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  - - - BIR-RDO'S RECORDS AVAILABLE TO LOCAL TREASURER & DEPUTY
        For this purpose, the records of the revenue district office of the Bureau of Internal Revenue shall be made available to the local treasurer, his deputy or duly authorized representative.