Sison, Jr. v Ancheta
GR No. L-59431, July 25, 1984
FACTS:
Batas Pambansa 135, which amends Section 21 of the National Internal Revenue Code of 1977, which provides for the
rates of tax on citizens or residents, was enacted. Petitioner as taxpayer alleges that by virtue thereof, he would be unduly discriminated against by the imposition of higher rates of tax upon his income arising from the exercise of his profession vis-à-vis those which are imposed upon fixed income or salaried individual taxpayers.
ISSUE:
Whether BP 135 transgresses both the equal protection and due process clauses of the Constitution as well as of the rule requiring uniformity in taxation
RULING:
No. The presumption of validity must prevail. The taxing power has the authority to make reasonable and natural
classifications for purposes of taxation. Recipients of compensation income are not entitled to make deductions for income tax purposes as there is practically no overhead expense, while professionals and businessmen have no uniform costs or expenses necessary to produce their income. There is ample justification to adopt the gross system of income taxation to compensation income, while continuing the system of net income taxation as regards professional and business income.
GR No. L-59431, July 25, 1984
FACTS:
Batas Pambansa 135, which amends Section 21 of the National Internal Revenue Code of 1977, which provides for the
rates of tax on citizens or residents, was enacted. Petitioner as taxpayer alleges that by virtue thereof, he would be unduly discriminated against by the imposition of higher rates of tax upon his income arising from the exercise of his profession vis-à-vis those which are imposed upon fixed income or salaried individual taxpayers.
ISSUE:
Whether BP 135 transgresses both the equal protection and due process clauses of the Constitution as well as of the rule requiring uniformity in taxation
RULING:
No. The presumption of validity must prevail. The taxing power has the authority to make reasonable and natural
classifications for purposes of taxation. Recipients of compensation income are not entitled to make deductions for income tax purposes as there is practically no overhead expense, while professionals and businessmen have no uniform costs or expenses necessary to produce their income. There is ample justification to adopt the gross system of income taxation to compensation income, while continuing the system of net income taxation as regards professional and business income.
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