Ormoc Sugar Company v.

Treasurer of Ormoc City

Topic: Equal Protection clause

PARTIES:
 Petitioner: Ormoc Sugar Company, Inc.
 Respondents: Treasurer of Ormoc City, The Municipal Board of Ormoc City

FACTS:
 Jan. 29, 1964 — Mun. Board of Ormoc passed Ordinance No. 4 imposing “on any
and all productions of centrifugal sugar milled at the Ormoc Sugar Company, Inc. in
Ormoc City a municipal tax equivalent to 1% per export sale to the US and other
foreign countries.”
 Payments for said tax were made under protest by the Ormoc Sugar Company. Then,
the company filed a complaint before the COFI Leyte against the Mun. Board of Ormoc
and the City Treasurer alleging that the ordinance is unconstitutional for being violative
of the equal protection clause and the rule on uniformity of taxation.
 Furthermore, petitioners argue that the tax was in the nature of import taxes and
customs duty which Ormoc city was unauthorized to collect under the Local Autonomy
Act.
 Respondents asserted that the tax ordinance was within the city’s power to enact
under the Local Autonomy Act and that the same did not violation the aforementioned
constitutional limitations.
 The COFI dismissed the petition and upheld the constitutionality of the ordinance and
declared the taxing power of the defendant chartered city broadened by the Local
Autonomy Act to include all other forms of taxes, licenses or fees not excluded in the
charter.
 Petitioners appealed to the SC.

ISSUES:
1. W/N the Ordinance is violative of the equal protection clause.
 YES. The ordinance taxes only centrifugal sugar
produced and exported by the Ormoc Sugar Company and one other. True, at the time
of the enactment of the Ordinance, they were the only existing sugar central in the city,
still, for the classification to be reasonable, it should be in terms applicable to future
conditions as well.
 The taxing ordinance should not be singular and
exclusive as to exclude any subsequently established sugar central.

* Take note of tax issue here, too.

JUDGMENT:
 Petition appealed from is REVERSED and challenge ordinance is declared
unconstitutional.
 Respondents are ordered to refund the P12K to the plaintiff.