Victorias Milling Co., Inc. vs. The Municipality of Victorias, Province of Negros Occidental

A municipal ordinance imposing graduated annual license taxes on sugar centrals and sugar refineries is valid as a revenue measure, not a mere regulatory license fee, where its purpose and effect are to raise revenue and the municipality is expressly authorized by statute—here, Section 1 of Commonwealth Act 472—to impose license taxes on occupations or businesses for revenue. The designation given by municipal authorities does not control; the determining factors are the purpose and effect of the imposition as apparent from the ordinance's provisions.

Victorias Milling Co., Inc. operated a sugar central and a sugar refinery within the Municipality of Victorias, Negros Occidental. The municipality had previously imposed license taxes on sugar centrals under Ordinance No. 25, series of 1953, and on sugar refineries under Ordinance No. 18, series of 1947. Ordinance No. 1, series of 1956, amended both ordinances by increasing the rates and the range of the graduated schedule of annual output capacity, expressly invoking the taxing power conferred by Commonwealth Act 472. Commonwealth Act 472 authorizes municipal councils to impose municipal license taxes on persons engaged in occupations or businesses and to levy just and uniform taxes other than percentage taxes and taxes on specified articles.

Victorias Milling Co., Inc. operated a sugar central and a sugar refinery in the Municipality of Victorias, Negros Occidental. On September 22, 1956, the municipal council approved Ordinance No. 1, series of 1956, amending Ordinance No. 25, series of 1953, which concerned sugar centrals, and Ordinance No. 18, series of 1947, which concerned sugar refineries. The amendatory ordinance increased the rates of license taxes on sugar centrals and increased both the rates and the range of the graduated schedule for sugar refineries. It stated that it was enacted pursuant to the taxing power conferred by Commonwealth Act 472.

Section 1 of Ordinance No. 1 required any person, corporation, or other form of company operating a sugar central or engaged in the manufacture of centrifugal sugar to pay an annual municipal license tax, payable quarterly. The schedule began at P1,000 for a sugar central with an annual output capacity of not less than 50,000 piculs, progressed upward through twelve other grades, and reached P40,000 for an output capacity of 1,500,001 piculs or more. Section 2 imposed similar taxes on sugar refineries, starting at P1,000 for a refinery with an annual output capacity of not less than 25,000 bags of 100 lbs., then P1,500 for 25,001 to 75,000 bags, and reaching P40,000 for 1,750,001 bags or more. Victorias Milling's production in both its sugar central and its sugar refinery fell within these maximum items in the schedule.

Resolution No. 60 of the municipal council, adopted on September 22, 1956 in conjunction with Ordinance No. 1, recited that the municipal treasurer had informed the council of the municipality's revenue and heavy obligations due to implementation of the Minimum Wage Law; that the administration planned to improve barrios, sitios, and rural areas through roads and feeder roads; that the low rates in prior ordinances were inadequate given the high cost of living; and that the price of sugar per picul was more than twice its pre-war average. The ordinance was recommended by the Provincial Board of Negros Occidental in Resolution No. 1864 dated October 26, 1956, and approved by the Undersecretary of Finance in a letter dated December 18, 1956, with the mandate that it take effect at the beginning of the ensuing calendar year 1957 pursuant to Section 2309 of the Revised Administrative Code.

Victorias Milling filed suit in the Court of First Instance of Negros Occidental, Civil Case No. 5565, seeking a declaration that Ordinance No. 1 was null and void, refund of all license taxes paid and to be paid under protest, and an order directing municipal and provincial officials to observe Section 357 of the Revised Manual of Instructions to Treasurers of Provinces, Cities and Municipalities, 1954 edition, regarding treatment of license taxes paid under protest. It alleged that the ordinance exceeded amounts fixed in Provincial Circular 12-A issued by the Finance Department on February 27, 1940; that it was discriminatory because Victorias Milling was the only operator of a sugar central and a sugar refinery in the municipality; that it constituted double taxation; and that the national government had preempted the field of taxation of sugar centrals or refineries. Victorias Milling had paid license taxes under protest amounting to P280,000 up to the second quarter of 1960.

The record showed that Victorias Milling's capital investment in the sugar central and sugar refinery was more or less P26,000,000. Its annual net income was P3,852,910 for 1956; P3,854,520 for 1957; P7,230,493 for 1958; P5,951,187 for 1959; and P7,809,250 for 1960. In 1940, when Provincial Circular 12-A suggested one centavo for every picul of annual output capacity, the price of sugar was around P6.00 per picul; by 1956, when Ordinance No. 1 was approved, the market quotation for export sugar ranged from P12.00 to P15.00 per picul. Victorias Milling also asserted that its milling and refining operations were not wholly performed within Victorias, because transportation of canes from plantation to mill site, operation and maintenance of the telephone system, inspection of crop progress, and other related activities were conducted in Cadiz, Manapla, Sagay, and Saravia as well.

• Excess of Provincial Circular 12-A: Plaintiff-appellant Victorias Milling Co., Inc. argued that Ordinance No. 1 exceeded the amounts fixed in Provincial Circular 12-A issued by the Finance Department on February 27, 1940.
• Discrimination: Plaintiff-appellant argued that the ordinance was discriminatory because it singled out Victorias Milling, the only operator of a sugar central and a sugar refinery within the jurisdiction of the Municipality of Victorias.
• Double Taxation: Plaintiff-appellant argued that the ordinance constituted double taxation because, in computing the taxes payable by the sugar refinery, the cost of raw sugar coming from the sugar central was not deducted, thereby taxing the raw sugar twice.
• National Preemption: Plaintiff-appellant argued that the national government had preempted the field of taxation with respect to sugar centrals or refineries, invoking Section 189 of the National Internal Revenue Code, which subjects proprietors or operators of sugar centrals or sugar refineries to percentage tax.
• Excessiveness: Plaintiff-appellant advanced that the ordinance was excessive, insisting that the amounts levied exceeded the cost of regulation and that the municipality had adequate funds, as evidenced by its cash surplus for the fiscal year ending 1956.
• Territorial Scope: Plaintiff-appellant argued that its business was not confined to the Municipality of Victorias, because transportation of canes, operation and maintenance of the telephone system, inspection of crop progress, and related activities were conducted in Cadiz, Manapla, Sagay, and Saravia.
• Refund: Plaintiff-appellant questioned the portion of the trial court's decision denying refund of license taxes paid under protest amounting to P280,000 for the period from the first quarter of 1957 to the second quarter of 1960, and objected to the order limiting refund to license taxes paid under protest after notice of the decision.

• Validity of Ordinance: Defendant-appellant Municipality of Victorias challenged the correctness of the trial court's decision invalidating Ordinance No. 1, series of 1956.
• Reasonableness and Sugar Prices: In its brief, the municipality stated that after 1956 the price of sugar had never gone below P16.00 per picul and had instead gone up, supporting the reasonableness of the ordinance.

• Nature of Ordinance: Whether Ordinance No. 1, series of 1956, was enacted as a regulatory measure or as a revenue measure.
• Authority and Approval: Whether the ordinance validly exercised the taxing power under Commonwealth Act 472 and complied with the required approval of the Secretary of Finance.
• Preemption: Whether the national government's imposition of percentage tax on sugar centrals or sugar refineries preempted municipal taxation of the same businesses.
• Reasonableness: Whether the ordinance was excessive, unreasonable, oppressive, or confiscatory.
• Discrimination: Whether the ordinance was discriminatory because Victorias Milling was the only operator of a sugar central and refinery in the municipality.
• Territoriality and Situs: Whether the municipality could tax Victorias Milling's business when some of its operations were conducted outside the municipality's territorial limits.
• Double Taxation: Whether the ordinance imposed double taxation.
• Refund: Whether Victorias Milling was entitled to refund of license taxes paid under protest, including the P280,000 paid from the first quarter of 1957 to the second quarter of 1960.

• Nature of Ordinance: Revenue measure. The ordinance's purpose and effect showed revenue raising, and it was an occupation or business tax authorized by Commonwealth Act 472, not a mere regulatory license fee.
• Authority and Approval: Valid. Commonwealth Act 472 expressly grants municipal councils authority to impose license taxes for revenue, and the ordinance was recommended by the Provincial Board and approved by the Undersecretary of Finance, effective beginning 1957 under Section 2309 of the Revised Administrative Code.
• Preemption: No. The national government preempted only percentage taxation; Commonwealth Act 472 allows municipal taxation of the same businesses or occupations subject to fixed internal revenue privilege taxes, except specified exceptions not applicable here.
• Reasonableness: Not excessive. The ordinance carried the presumption of validity; Victorias Milling failed to prove unreasonableness, and the cost of regulation is not the gauge for a revenue ordinance.
• Discrimination: No. The ordinance applies to any sugar central or sugar refinery in the municipality; the fact that Victorias Milling was the sole operator did not make it discriminatory.
• Territoriality and Situs: Valid. The situs of the business was the Municipality of Victorias, where the sugar central and refinery were located; operations outside did not negate the municipality's power to tax.
• Double Taxation: No. The taxes covered different objects or occupations—sugar central operation and sugar refinery operation—and were imposed on the business based on output capacity, not on sugar itself.
• Refund: No. Because Ordinance No. 1 was valid and subsisting, the complaint, including the prayer for refund, was dismissed.

• Nature of Ordinance: A municipality is authorized to impose three kinds of licenses: (1) license for regulation of useful occupations or enterprises; (2) license for restriction or regulation of non-useful occupations or enterprises; and (3) license for revenue. The first two fall within the police power under the general welfare clause, while the third rests on the taxing power and must be expressly conferred by statute. The designation "license tax" does not control; the determining factors are the purpose and effect of the imposition as apparent from the ordinance. Ordinance No. 1 recited that its source of taxing power was Commonwealth Act 472. Resolution No. 60, adopted in conjunction with the ordinance, stated that the municipal treasurer had informed the council of the municipality's revenue and heavy obligations due to the Minimum Wage Law, the plan to improve barrios and rural areas, the inadequacy of low rates given the high cost of living, and the fact that the price of sugar per picul was more than twice its pre-war average. The ordinance imposed a maximum annual tax of P40,000 for sugar centrals and P40,000 for sugar refineries, and contained nothing indicating that the tax was merely for police inspection, supervision, or regulation. Thus, the ordinance was for raising money. Standard Vacuum vs. Antigua upheld a similar graduated license tax as an occupation tax imposed under the taxing power for revenue under Commonwealth Act 472. Panaligan vs. City of Tacloban, Pacific Commercial Co. vs. Romualdez, Lacson vs. City of Bacolod, and Santos vs. Municipal Government of Caloocan were distinguished because the ordinances there lacked a plain and clear statutory prop or involved an export tax, general welfare clause, or statutory limits.

• Authority and Approval: Section 1 of Commonwealth Act 472 grants municipal councils authority to impose municipal license taxes upon persons engaged in any occupation or business, or exercising privileges in the municipality, by requiring them to secure licenses at rates fixed by the council, and to levy for public local purposes just and uniform taxes other than percentage taxes and taxes on specified articles. Section 4, paragraph 2, of Commonwealth Act 472 requires the approval of the Secretary of Finance whenever the rate of fixed municipal license taxes on businesses not excepted or otherwise covered and subject to the fixed annual tax under Section 182 of the National Internal Revenue Law is in excess of P50 per annum. The ordinance was recommended by the Provincial Board of Negros Occidental in Resolution No. 1864 dated October 26, 1956, and the Undersecretary of Finance approved it in a letter dated December 18, 1956. Because the ordinance was amendatory, the approval mandated that it take effect at the beginning of the ensuing calendar year 1957 pursuant to Section 2309 of the Revised Administrative Code. The ordinance therefore had the required approval.

• Preemption: Preemption in taxation refers to an instance where the national government elects to tax a particular area, impliedly withholding from the local government the delegated power to tax the same field. The doctrine primarily rests upon the intention of Congress. Conversely, if Congress allows municipal corporations to cover fields of taxation it already occupies, preemption does not apply. Victorias Milling invoked Section 189 of the National Internal Revenue Code, which subjects proprietors or operators of sugar centrals or sugar refineries to percentage tax. The municipal tax, however, was not a percentage tax; the rates were based on maximum annual output capacity, not a share or a tax based on the amount of proceeds realized from the sale of sugar. The national government preempted only the field of percentage taxation. Section 1 of Commonwealth Act 472 expressly removes from municipalities the power to exact percentage taxes, but Section 4(1) allows municipal councils to tax persons engaged in the same businesses or occupations on which fixed internal revenue privilege taxes are regularly imposed by the National Government, with certain exceptions specified in Section 3. The case did not fall within the exceptions. There was no preemption.

• Reasonableness: An ordinance carries with it the presumption of validity, although the question of reasonableness is open to judicial inquiry. Courts will go slow in writing off an ordinance as unreasonable unless the amount is so excessive as to be prohibitive, arbitrary, unreasonable, oppressive, or confiscatory. Relevant factors include municipal conditions as a whole and the nature of the business subject to imposition. Victorias Milling did not sufficiently prove that the license taxes were unreasonable. It limited itself to insisting that the amounts levied exceeded the cost of regulation and that the municipality had adequate funds as evidenced by its cash surplus for the fiscal year ending 1956. The cost of regulation cannot be taken as a gauge if the municipality really intended to enact a revenue ordinance; if the charge exceeds the expense of issuing a license and the costs of regulation, it is a tax, and the rule that license fees for regulation must bear a reasonable relation to the expense of regulation has no application. A cash surplus alone cannot stop a municipality from enacting a revenue ordinance increasing license taxes in anticipation of municipal needs. The municipality had reason to act: Provincial Circular 12-A in 1940 suggested one centavo for every picul of annual output capacity when sugar was around P6.00 per picul; by 1956, export sugar ranged from P12.00 to P15.00 per picul, yet the rate under Ordinance No. 1 was merely from one centavo to two centavos. The trial court's statement that refinery rates increased by 2,000% was a misapprehension: the original maximum rate of P2,000 under Ordinance No. 18, series of 1947, applied only to a refinery with an output capacity of 90,000 or more sacks; under Ordinance No. 1, P2,000 remained for refineries with an output capacity of 75,001 to 100,000 bags, with ten more scales up to P40,000 only for 1,750,001 bags or more. Victorias Milling's capital investment of more or less P26,000,000 and its annual net income from 1956 to 1960 showed that the ordinance was neither confiscatory nor unjust and unreasonable.

• Discrimination: The ordinance did not single out Victorias Milling as the only object of the ordinance; it applied to any sugar central or sugar refinery which might operate in the municipality. The fact that Victorias Milling was actually the sole operator did not make the ordinance discriminatory. In Shell Co. of P.I., Ltd. vs. Vaño, the circumstance that there was no other person in the locality who exercised the occupation did not make the ordinance discriminatory and hostile, because it was and would be applicable to any person or firm who exercised such calling or occupation. In Ormoc Sugar Company, Inc. vs. Municipal Board of Ormoc City, the ordinance even named Ormoc Sugar Company, Incorporated specifically, yet it did not suffer from a constitutional or statutory infirmity. Victorias Milling's name was never mentioned in the disputed ordinance. No discrimination existed.

• Territoriality and Situs: It sufficed that Victorias Milling engaged in a business or occupation subject to an exaction by the municipality within the territorial boundaries of that municipality. Victorias Milling's sugar central and sugar refinery were located within the Municipality of Victorias, and in that central and refinery it manufactured centrifugal sugar and refined sugar. Its assertion that its milling and refining operations were not wholly performed within Victorias—because transportation of canes, operation and maintenance of the telephone system, inspection of crop progress, and related activities were conducted in Cadiz, Manapla, Sagay, and Saravia—was not relevant. If Victorias Milling's reasoning were followed, neither Victorias nor any of the other municipalities would be able to impose the tax. The tax was imposed upon the business of operating a sugar central and a sugar refinery, and the situs of that business was precisely the Municipality of Victorias.

• Double Taxation: Double taxation has been described as direct duplicate taxation. For double taxation to exist, the same property must be taxed twice when it should be taxed but once; it is also defined as taxing the same person twice by the same jurisdiction for the same thing. As stated in Manila Motor Company, Inc. vs. Ciudad de Manila, there is double taxation when the same property is subject to two taxes by the same entity or government, for the same purpose and during the same period of time. Here, the two taxes covered two different objects: Section 1 of the ordinance taxed a person operating sugar centrals or engaged in the manufacture of centrifugal sugar, while Section 2 taxed operators of sugar refinery mills. One occupation or business is different from the other. The disputed taxes were imposed on occupation or business, not on sugar; the amount depended on the annual output capacity of the mills, regardless of the actual sugar milled. Victorias Milling's argument might have had a point if the object of taxation were the sugar it produced, not the business of producing it. There was no double taxation.

• Refund: The validity of Ordinance No. 1 removed the basis for refund. The Supreme Court reversed the judgment under review and dismissed plaintiff's complaint as supplemented and amended, with costs against plaintiff. The trial court's orders regarding refund of taxes paid under protest after notice, and its denial of refund of the P280,000 paid from the first quarter of 1957 to the second quarter of 1960, were superseded by the reversal.

• Municipal license taxes: regulation vs. revenue — A municipality is authorized to impose three kinds of licenses: (1) license for regulation of useful occupations or enterprises; (2) license for restriction or regulation of non-useful occupations or enterprises; and (3) license for revenue. The first two fall within the police power under the general welfare clause; the third rests on the taxing power and must be expressly conferred by statute. The designation "license tax" does not control; the determining factors are the purpose and effect of the imposition as apparent from the ordinance. In this case, Ordinance No. 1 was held to be a revenue measure because its purpose and effect were to raise money, it imposed large maximum annual taxes, and it contained no provisions for police inspection, supervision, or regulation.

• Preemption in taxation — Preemption refers to an instance where the national government elects to tax a particular area, impliedly withholding from the local government the delegated power to tax the same field. The doctrine primarily rests upon the intention of Congress. Conversely, if Congress allows municipal corporations to cover fields of taxation it already occupies, preemption does not apply. The Court applied this doctrine by holding that the national government preempted only percentage taxation under Section 189 of the National Internal Revenue Code, while Section 4(1) of Commonwealth Act 472 allowed municipal councils to tax the same businesses or occupations subject to fixed internal revenue privilege taxes, with exceptions not applicable here.

• Presumption of validity and reasonableness of ordinances — An ordinance carries with it the presumption of validity, although the question of reasonableness is open to judicial inquiry. Courts will go slow in writing off an ordinance as unreasonable unless the amount is so excessive as to be prohibitive, arbitrary, unreasonable, oppressive, or confiscatory. Relevant factors include municipal conditions as a whole and the nature of the business subject to imposition. The Court applied this by finding that Victorias Milling failed to prove unreasonableness; the cost of regulation was not the gauge for a revenue ordinance, and a cash surplus alone could not stop the municipality from enacting a revenue ordinance.

• Double taxation — Double taxation is direct duplicate taxation. For double taxation to exist, the same property must be taxed twice when it should be taxed but once; it is also defined as taxing the same person twice by the same jurisdiction for the same thing, or subjecting the same property to two taxes by the same entity or government, for the same purpose and during the same period. The Court found no double taxation because the taxes covered different objects or occupations—sugar central operation and sugar refinery operation—and were imposed on the business based on output capacity, not on sugar itself.

• Discrimination in license taxation — An ordinance is not discriminatory merely because only one person or firm currently exercises the occupation or business taxed, provided the ordinance applies to any person or firm who may exercise such calling or occupation. The Court applied this by holding that the ordinance applied to any sugar central or sugar refinery in the municipality, and Victorias Milling being the sole operator did not make it discriminatory. Shell Co. of P.I., Ltd. vs. Vaño and Ormoc Sugar Company, Inc. vs. Municipal Board of Ormoc City were cited in support.

• Situs of taxation on business — It suffices that the taxpayer engages in a business or occupation subject to an exaction by the municipality within the territorial boundaries of that municipality. The situs of the business of operating a sugar central and a sugar refinery is the municipality where the central and refinery are located. The Court applied this by holding that operations conducted outside Victorias did not negate the municipality's power to tax the business, because the sugar central and refinery were located in Victorias.

• "The determining factors are the purpose and effect of the imposition as may be apparent from the provisions of the ordinance." — This passage states the test for distinguishing a regulatory license fee from a revenue-raising license tax, which was central to the Court's holding that Ordinance No. 1 was a revenue measure.

• "We, accordingly, rule that Ordinance No. 1, series of 1956, of the Municipality of Victorias, was promulgated not in the exercise of the municipality's regulatory power but as a revenue measure — a tax on occupation or business. The authority to impose such tax is backed by the express grant of power in Section 1 of Commonwealth Act 472." — This is the ratio decidendi on the ordinance's nature and validity as an occupation or business tax.

• "It is correct to say that preemption in the matter of taxation simply refers to an instance where the national government elects to tax a particular area, impliedly withholding from the local government the delegated power to tax the same field. This doctrine primarily rests upon the intention of Congress." — This passage defines the preemption doctrine applied by the Court in rejecting Victorias Milling's argument that national percentage taxation preempted municipal taxation.

• "For double taxation to exist, "the same property must be taxed twice, when it should be taxed but once."" — This quotation states the canonical formulation of double taxation relied upon by the Court in finding that the ordinance taxed distinct occupations or businesses rather than the same property twice.

• Standard Vacuum vs. Antigua, 96 Phil. 909, 911 — Controlling precedent; the Court upheld a similar graduated license tax as an occupation tax imposed not under the police or regulatory power but under the taxing power for revenue, in accordance with Section 1 of Commonwealth Act 472.
• Panaligan vs. City of Tacloban, L-9319, September 27, 1957 — Distinguished; the inspection fee sought to be collected was in reality an export tax specifically withheld from municipal taxing power under Section 2287 of the Revised Administrative Code.
• Pacific Commercial Co. vs. Romualdez, 49 Phil. 917, 926 — Distinguished; the tax on frozen meat was nullified because tax measures on cold stores were not then within the legislative grant to the City of Manila.
• Lacson vs. City of Bacolod, L-15892, April 23, 1962 — Distinguished; the ordinance was held ultra vires because the authority to tax cannot be derived from the general welfare clause.
• Santos vs. Municipal Government of Caloocan, L-15807, April 22, 1963 — Distinguished; the fees imposed exceeded the statutory grant, which allowed only one fee for slaughter or slaughterhouse services.
• Shell Co. of P.I., Ltd. vs. Vaño, 94 Phil. 389, 393 — Followed; the circumstance that no other person in the locality exercised the occupation did not make the ordinance discriminatory, because it applied to any person or firm who exercised such calling or occupation.
• Ormoc Sugar Company, Inc. vs. Municipal Board of Ormoc City, L-24322, July 21, 1967; 1967C Phild. 116, 119 — Followed; an ordinance that specifically named Ormoc Sugar Company, Incorporated did not suffer from a constitutional or statutory infirmity.
• Manila Motor Company, Inc. vs. Ciudad de Manila, 72 Phil. 336, 339 — Cited for the definition of double taxation as subjecting the same property to two taxes by the same entity or government, for the same purpose and during the same period of time.
• Cu Unjieng vs. Patstone, 42 Phil. 818, 828-830 — Cited for the three kinds of licenses a municipality may impose and for the rule that the taxing power must be expressly conferred by statute.
• Compañia General de Tabacos de Filipinas vs. City of Manila, L-16619, June 29, 1963 — Cited for the distinction between license fees, imposed in the exercise of police power for regulation, and taxes, imposed for the purpose of raising revenues.
• Municipality of Cotabato vs. Santos, 105 Phil. 963, 966 — Cited as supporting the same ruling as Standard Vacuum vs. Antigua.

• Section 1, Commonwealth Act 472 — Grants municipal councils authority to impose municipal license taxes upon persons engaged in any occupation or business, or exercising privileges in the municipality, by requiring them to secure licenses at rates fixed by the council, and to levy for public local purposes just and uniform taxes other than percentage taxes and taxes on specified articles. The Court relied on this as the express source of the taxing power for Ordinance No. 1.
• Section 4, paragraph 2, Commonwealth Act 472 — Requires the approval of the Secretary of Finance whenever the rate of fixed municipal license taxes on businesses not excepted or otherwise covered and subject to the fixed annual tax under Section 182 of the National Internal Revenue Law is in excess of P50 per annum. The Court found that the ordinance was recommended by the Provincial Board and approved by the Undersecretary of Finance.
• Section 4(1), Commonwealth Act 472 — Allows municipal councils to tax persons engaged in the same businesses or occupations on which fixed internal revenue privilege taxes are regularly imposed by the National Government, with certain exceptions specified in Section 3. The Court used this to reject the preemption argument.
• Section 3, Commonwealth Act 472 — Contains exceptions to the municipal taxing power. The Court found that the case did not fall within the exceptions.
• Section 189, National Internal Revenue Code — Subjects proprietors or operators of sugar centrals or sugar refineries to percentage tax. Victorias Milling invoked this provision to argue preemption; the Court held that it preempted only percentage taxation, not the municipal occupation or business tax at issue.
• Section 2309, Revised Administrative Code — Provides that the ordinance should take effect at the beginning of the ensuing calendar year. The Court noted that the Undersecretary of Finance's approval mandated effect at the beginning of 1957 pursuant to this section.
• Section 357, Revised Manual of Instructions to Treasurers of Provinces, Cities and Municipalities, 1954 edition — Provides for the treatment of license taxes paid under protest, including their entry as Undistributed Income and reversion upon final determination. The trial court ordered observance of this provision, but the Supreme Court reversed because the ordinance was valid.
• Section 2238, Revised Administrative Code — General power of municipal councils to enact ordinances and regulations under the general welfare clause. The Court cited this to explain that the first two classes of licenses—regulation of useful and non-useful occupations—fall under police power, while revenue licenses rest on taxing power.
• Section 2287, Revised Administrative Code — Cited for the rule that the taxing power must be expressly conferred by statute upon the municipality; also noted in distinguishing Panaligan vs. City of Tacloban, where the inspection fee was in reality an export tax withheld from municipal taxing power.

Concepcion, C.J.; Reyes, J.B.L.; Dizon; Makalintal; Zaldivar; Castro; Angeles; Fernando; and Capistrano, JJ., concur.