Butuan Sawmill v. City of Butuan
Butuan Sawmill v. City of Butuan
DOCTRINE:
An earlier special statute is an exception to the later general statute.·Where there are two statutes, the earlier
special and the later general·the terms of the general broad enough to include the matter provided for in the
special·the fact that one is special and the other is general creates a presumption that the special is to be considered
as remaining an exception to the general, one as a general law of the land, the other as the law of a particular case.
FACTS:
1. Butuan Sawmill was granted a legislative franchise under RA 399 for electric light, heat and power system
subject to the conditions established in Act 3636, as amended by Commonwealth Act No. 132.
2. On Oct 1, 1950 Ordinance no. 7 took effect, which imposes a tax of 2% on the gross sales or receipts of
any business operated in the city and provides penalties for violation thereof. Ordinance no. 11
(December 1950) amended the Ordinance no. 7, enumerating the kinds of business required to pay the tax,
further amended Ordinance no. 11 by Ordinance no. 148 (June 1962) by including the coverage of taxable
business “Those engaged in the business of electric light, heat and power (sic) x x x”
3. Respondent alleged that the city has the power to impose levy and collection of taxes for general and
special purpose under RA 523 and its taxing power was enlarged by RA 2264, which the City has the
authority to impose the 2% tax on the gross sales or receipts of the business of electric light, heat and power
of the Butuan Sawmill.
4. Butuan Sawmill questioned the constitutionality of the Ordinance, as it impairs the obligation of contract
and deprives it of property without due process of law.
ISSUE: W/N Butuan Sawmill is within the taxing authority of the questioned taxing ordinance. – NO.
RULING:
The argument of the appellant city that, under subparagraph (d) of the Local Autonomy Act, the business of electric
light, heat and power, being an exception to those which it cannot tax (like waterworks and irrigation), is within the
city’s taxing power.
This argument is untenable, because (1) subparagraph (j) of the same section specifically withholds the imposition
of taxes on persons paying franchise tax (like appellee herein), and (2) the city’s interpretation of the provision
would result in double taxation against the business of the appellee because the internal revenue code already
imposes a franchise tax.
The logical construction of section 2(d) of Republic Act 2264, that would not nullify section 2 (j) of the same Act, is
that the local government may only tax electric light and power utilities that are not subject to franchise taxes, unless
the franchise itself authorizes additional taxation by cities or municipalities.
Be it noted that the franchise was granted by act of the legislature on 18 June 1949 while the city’s charter was
approved on 15 June 1950.
“Where there are two statutes, the earlier special and the later general the terms of the general broad enough to
include the matter provided for in the special the fact that one is special and the other is general creates a
presumption that the special is to be considered as remaining an exception to the general, one as a general law of the
land, the other as the law of a particular case.