OS ME A vs .

ORBOS
220 SCRA 703; GR No. 99886, March 31, 1993

" To avoid the taint of unlawful delegation of the power to tax, there must be a
standard whi ch i mpl i es that the l egi sl ature determi nes matter of principle
and lays down fundamental policy."

FACTS:
Senator John Osmea assails the constitutionality of paragraph 1cof PD 1956, as
amended by EO 137, empowering the Energy Regulatory Board (ERB) to approve
the i ncrease of f uel pri ces or i mpose addi ti onal amounts on petrol eum
products whi ch proceeds shal l accrue to the Oi l Price Stabilization Fund
(OPSF) established for the reimbursement to ailing oil companies in the event of
sudden price increases. The petitioner avers that the collection on oil products
establishments is an undue and invalid delegation of legislative power to tax. Further,
the petitioner points out that since a 'special fund' consists of monies collected through
the taxing power of a State, such amounts belong to the State, although the use thereof
is limited to the special purpose/objective for which it was created. It thus appears that
the challenge posed by the petitioner is premised primarily on t he
v i e w t ha t t he powe r s gr ant ed t o t h e ERB u nde r P. D. 1956 , as
amended, partake of the nature of the taxation power of the State.

ISSUE:
Is there an undue delegation of the legislative power of taxation?

HELD:
None. It seems clear that while the funds collected may be referred to as taxes, they
are exacted i n the exerci se of the pol i ce power of the State. Moreover, that
the OPSF as a special fund is plain from the special treatment given it by E.O. 137. It is
segregated from the general fund; and while it is placed in what the law refers to as a
"trust liability account," the fund nonetheless remains subject to the scrutiny and review
of the COA. The Court is satisfied that these measures comply with the constitutional
descri pti on of a "speci al f und." Wi th regard to the al l eged undue delegation
of legislative power, the Court finds that the provision conferring the authori t y upon
the ERB to i mpose addi ti onal amount s on pet rol eum products provi des a
suf f i ci ent standard by whi ch the authori t y must be exercised. In addition to the
general policy of the law to protect the local consumer by stabilizing and subsidizing
domestic pump rates, P.D. 1956expressly authorizes the ERB to impose additional
amounts to augment there sources of the Fund.