Miaa Vs. Ca.docx

MANILA INTERNATIONAL AIRPORT AUTHORITY v. Court of Appeals Facts: Petitioner Manila International Airport Authority (MIAA) operates the Ninoy Aquino International Airport (NAIA) As operator of the international airport, MIAA administers the land, improvements and equipment within the NAIA Complex. The MIAA Charter transferred to MIAA approximately 600 hectares of land,... The MIAA Charter further provides that no portion of the land transferred to MIAA shall be disposed of through sale or any other mode unless specifically approved by the President of the Philippines. The OGCC opined that the Local Government Code of 1991 withdrew the exemption from real estate tax granted to MIAA under Section 21 of the MIAA Charter. Thus, MIAA negotiated with... respondent City of Parañaque to pay the real estate tax imposed by the City. MIAA then paid some of the real estate tax already due. MIAA received Final Notices of Real Estate Tax Delinquency from the City of Parañaque. The Mayor of the City of Parañaque threatened to sell at public auction the Airport Lands and Buildings should MIAA fail to pay the... real estate tax delinquency. MIAA filed with the Court of Appeals an original petition for prohibition and injunction The petition sought to restrain the City of Parañaque from imposing real estate tax on, levying... against, and auctioning for public sale the Airport Lands and Buildings. Court of Appeals dismissed the petition because MIAA filed it beyond the 60day reglementary period. Court of Appeals also denied... motion for reconsideration... the present petition for review. MIAA insists that it is... exempt from real estate tax under Section 234 of the Local Government Code because the Airport Lands and Buildings are owned by... the Republic. To justify the exemption, MIAA invokes the principle that the government cannot tax itself.

Respondents invoke Section 193 of the Local Government Code, which expressly withdrew the tax exemption privileges of "government-owned andcontrolled corporations" upon the effectivity of the Local Government Code. Issues: whether the Airport Lands and Buildings of MIAA are exempt from real estate tax under existing laws. Ruling: We rule that MIAA's Airport Lands and Buildings are exempt from real estate tax imposed by local governments. First, MIAA is not a government-owned or controlled corporation but an instrumentality of the National Government and thus exempt from local taxation. Second, the real properties of MIAA are owned by the Republic of the Philippines and thus... exempt from real estate tax. There is no dispute that a government-owned or controlled corporation is not exempt from real estate tax. However, MIAA is not a government-owned or controlled corporation. Since MIAA is neither a stock nor a non-stock corporation, MIAA does not qualify as a government-owned or controlled corporation. MIAA is a government instrumentality vested with corporate powers to perform efficiently its governmental functions. MIAA is like any other government instrumentality, the only difference is that MIAA is vested with corporate powers. When the law vests in a government instrumentality corporate powers, the instrumentality does not become a corporation. Unless the government instrumentality is organized as a stock or non-stock corporation, it remains a government instrumentality exercising not only... governmental but also corporate powers. Thus, MIAA exercises the governmental powers of eminent domain,... police authority... and the levying of fees and charges. At the same time, MIAA exercises "all the... powers of a corporation under the Corporation Law, insofar as these powers are not inconsistent with the provisions of this Executive Order." When local governments invoke the power to tax on national government instrumentalities, such power is construed strictly against local governments. The rule is that a tax is never presumed and there must be clear language in the law imposing the tax. Any doubt whether a person,... article or activity is taxable is resolved against taxation. This rule applies with greater force when local governments seek to tax national government instrumentalities.

Another rule is that a tax exemption is strictly construed against the taxpayer claiming the exemption. However, when Congress grants an exemption to a national government instrumentality from local taxation, such exemption is construed liberally in favor of the national... government instrumentality. There must be express language in the law empowering local governments to tax national government instrumentalities. Any doubt whether such power exists is resolved against local... governments.