FACTS
In 1950, acting pursuant to the Revised Charter of the City of Manila empowering it to impose a municipal occupation tax on persons engaged in various professions, the Municipal Board of Manila approved Ordinance No. 3398, which imposed a municipal occupation tax on persons exercising various professions (e.g., lawyers, doctors, dentists, etc.) in the city and penalized non-compliance thereof.
A number of professionals, among them Punsalan, who had already paid their occupation tax under the National Internal Revenue Code, paid the additional tax prescribed in the ordinance under protest. They then filed an action to annul the ordinance and the provision of the Manila charter authorizing said exaction and to collect the refund on the taxes paid under protest.
The CFI of Manila upheld the validity of the provision of City Charter authorizing the enactment of the ordinance but declared the ordinance itself illegal and void on the ground that the penalty therein was not legally authorized.
RULING
For the City of Manila.
The Revised Charter of Manila in express terms empowers the Municipal Board “to fix penalties for the violation of ordinances which shall not exceed two hundred pesos fine or six months’ imprisonment, or both such fine and imprisonment, for a single offense.”
The ordinance imposes the tax upon every person “exercising” or “pursuing”— in the City of Manila naturally — any one of the occupations named, but does not say that such person must have his office in Manila. What constitutes exercise or pursuit of a profession in the city is a matter of judicial determination.
The SC also added that the argument against double taxation may not be invoked where one tax is imposed by the state and the other is imposed by the city, it being widely recognized that there is nothing inherently obnoxious in the requirement that license fees or taxes be exacted with respect to the same occupation, calling or activity by both the state and the political subdivisions thereof.
