NITAFAN VS CIR

G.R. No. 78780 July 23 1987 [Salaries of the members of Judiciary, Tax Exemption]

FACTS:
The Chief Justice has previously issued a directive to the Fiscal Management and Budget Office to
continue the deduction of withholding taxes from salaries of the Justices of the Supreme Court and
other members of the judiciary. This was affirmed by the Supreme Court en banc on 4 December 1987.

Nitafan and some others, duly qualified and appointed judges of the RTC, NCR, all with stations in
Manila, seek to prohibit and/or perpetually enjoin the Commissioner of Internal Revenue and the
Financial Officer of the Supreme Court, from making any deduction of withholding taxes from their
salaries.

They submit that "any tax withheld from their emoluments or compensation as judicial officers
constitutes a decrease or diminution of their salaries, contrary to the provision of Section 10, Article VIII
of the 1987 Constitution mandating that during their continuance in office, their salary shall not be
decreased," even as it is anathema to the Ideal of an independent judiciary envisioned in and by said
Constitution."

ISSUE: Whether or not members of the Judiciary are exempt from income taxes.

HELD:
NO. Intent to delete express grant of exemption of income taxes to members of Judiciary

The salaries of members of the Judiciary are subject to the general income tax applied to all taxpayers.
This intent was somehow and inadvertently not clearly set forth in the final text of the Constitution as
approved and ratified in February, 1987 (infra, pp. 7-8). Although the intent may have been obscured by
the failure to include in the General Provisions a proscription against exemption of any public officer or
employee, including constitutional officers, from payment of income tax, the Court since then has
authorized the continuation of the deduction of the withholding tax from the salaries of the members of
the Supreme Court, as well as from the salaries of all other members of the Judiciary. The Court hereby
makes of record that it had then discarded the ruling in Perfecto vs. Meer and Endencia vs. David.

The 1973 Constitution has provided that no salary or any form of emolument of any public officer or
employee, including constitutional officers, shall be exempt from payment of income tax (Section 6,
Article XV) which was not present in the 1987 Constitution. The deliberations of the 1986
Constitutional Commission relevant to Section 10, Article VIII (The salary of the Chief Justice and of the
Associate Justices of the Supreme Court, and of judges of lower courts shall be fixed by law. During their
continuance in office, their salary shall not be decreased), negate the contention that the intent of the
framers is to revert to the original concept of non-diminution of salaries of judicial officers.

Equality of branches of government effected by modifications in provision.

The term diminished be changed to decreased and that the words nor subjected to income tax be
deleted so as to give substance to equality among the three branches in the government. A period (.)
after decreased was made on the understanding that the salary of justices is subject to tax. With the
period, the doctrine in Perfecto vs. Meer and Endencia vs. David is understood not to apply anymore.
Justices and judges are not only the citizens whose income have been reduced in accepting service in
government and yet subjected to income tax. Such is true also of Cabinet members and all other
employees.

Constitutional construction adopts the intent of the framers and people adopting the law.

The ascertainment of the intent is but in keeping with the fundamental principle of constitutional
construction that the intent of the framers of the organic law and of the people adopting it should be
given effect. The primary task in constitutional construction is to ascertain and thereafter assure the
realization of the purpose of the framers and of the people in the adoption of the Constitution. It may
also be safely assumed that the people in ratifying the Constitution were guided mainly by the
explanation offered by the framers. In the case at bar, Section 10, Article VIII is plain that the
Constitution authorizes Congress to pass a law fixing another rate of compensation of Justices and
Judges but such rate must be higher than that which they are receiving at the time of enactment, or if
lower, it would be applicable only to those appointed after its approval. It would be a strained
construction to read into the provision an exemption from taxation in the light of the discussion in the
Constitutional Commission.