Lutz vs.

Araneta
LUTZ
GR
98 PHIL 148

v.
No.

L-7859,

December

22,

ARANETA
1955

FACTS: Plaintiff Walter Lutz, in his capacity as judicial administrator of the intestate estate of
Antionio Ledesma,
sought to recover from the CIR the sum of P14,666.40 paid by the estate as taxes, under section 3 of
the CA 567 or the Sugar Adjustment Act thereby assailing its constitutionality, for it provided for an
increase of the
existing tax on the manufacture of sugar, alleging that such enactment is not being levied for a public
purpose
but solely and exclusively for the aid and support of the sugar industry thus making it void and
unconstitutional.
The sugar industry situation at the time of the enactment was in an imminent threat of loss and needed
to be
stabilized by imposition of emergency measures.
ISSUE: Is CA 567 constitutional, despite its being allegedly violative of the equal protection clause,
the purpose of which is not for the benefit of the general public but for the rehabilitation only of the
sugar industry?
HELD: Yes. The protection and promotion of the sugar industry is a matter of public concern, it
follows that the
Legislature may determine within reasonable bounds what is necessary for its protection and
expedient for its
promotion. Here, the legislative discretion must be allowed to fully play, subject only to the test of
reasonableness; and it is not contended that the means provided in the law bear no relation to the
objective
pursued or are oppressive in character. If objective and methods are alike constitutionally valid, no
reason is seen
why the state may not levy taxes to raise funds for their prosecution and attainment. Taxation may be
made the implement of the state's police power.

Gomez vs. Palomar

GOMEZ
GR
25 SCRA 827

v.
No.

L-23645,

October

29,

PALOMAR
1968

FACTS: Petitioner Benjamin Gomez mailed a letter at the post office in San Fernando, Pampanga. It
did not bear
the special anti-TB stamp required by the RA 1635. It was returned to the petitioner. Petitioner now
assails the
constitutionality of the statute claiming that RA 1635 otherwise known as the Anti-TB Stamp law is
violative of
the equal protection clause because it constitutes mail users into a class for the purpose of the tax
while leaving
untaxed the rest of the population and that even among postal patrons the statute discriminatorily
grants
exemptions. The law in question requires an additional 5 centavo stamp for every mail being posted,
and no mail
shall be delivered unless bearing the said stamp.
ISSUE: Is the Anti-TB Stamp Law unconstitutional, for being allegedly violative of the equal
protection clause?
HELD: No. It is settled that the legislature has the inherent power to select the subjects of taxation and
to grant
exemptions. This power has aptly been described as "of wide range and flexibility." Indeed, it is said
that in the
field of taxation, more than in other areas, the legislature possesses the greatest freedom in
classification. The
reason for this is that traditionally, classification has been a device for fitting tax programs to local
needs and
usages in order to achieve an equitable distribution of the tax burden.
The classification of mail users is based on the ability to pay, the enjoyment of a privilege and on
administrative
convenience. Tax exemptions have never been thought of as raising revenues under the equal
protection clause.