Flashcards Studio

City of Lumina passes Ordinance No. 2026-12 imposing a 3% gross receipts tax on all taxable businesses operating within the city, to be collected by the City Treasurer for the “Lumina Development Fund.” The ordinance is enacted after a public hearing and is signed by the Mayor. The tax applies uniformly to all businesses, with exemptions only as required by national law. A group of small business operators challenges the levy, arguing that it is not a valid tax but an invalid regulatory charge because there is no statute expressly authorizing this specific levy. (a) Identify the central doctrine governing the requisites of a valid tax under Philippine law. (b) Distinguish, in this context, between a tax and a license fee or regulatory charge. (c) Apply the doctrine to the facts and determine whether the levy is a valid tax or an invalid charge, explaining your conclusion.