DEPARTMENT OF THL INTERIOR AND LOCAL GOVERNMENT A.

Francisco Gold Condominium ll Bldg' EDSA

corner Mapagmahal St', Diliman, Quezon City

RePublic of the PhiliPPines

OffICE

OF

TtItr SECRETARY
DILG OPINTON NO. 47

S.

2OIO

16 APril 2010 ilS. I-ANEUTA I. GONZAI"EZ Secretary to the Sanggunian Municipality of del Gallego Province of Camarines Sur

Dear Ms. Gonzales:

This concerns your letter-query seeking the opinion of this Oepartment as to the form of legislative output (resolution . or providing for tax orciinanc") that the local sanggunian should pass in
amnesty on the payments of real properties'

In this regard, please be informed that we already answered .a similar query in- DILG Opinion No. 49, series of 2008, dated 01 July to 2008. in siiO opinion, conferment to the Governor of the power be enter into compromise agreements with tax delinquents cannot
done through a mere resolution.

For your ready reference, please find the attached photocopy of the said DILG OPinion.
VerY trulY Yours, BY AUTHORITY OF THE SECRETARY:

_ -.,. / t ATTY. JESUS B. DOQUE lY Director III, Le.{al Service

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DEFA,RTM['N'['ON TI.I T' IN'I'II,RN0I{ ANO [,OCAL GOVEI{NMENT

Francisco Cold Condominiunr

ll, tiDSA cor' Mapagntahal St.' Diliman, Quceon Oity

@trFtIG OF ]THtr U,IINDERtrCRHTARY IF@R t@CAt G@VEIRINNNENIT

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HON. MA. CHONA [4. DIIT,IAYUGA Sangguniang Panlalawigan Member Provincial Capitol Building Capitol Site, Batangas City
Dear SP Member Dimayuga:

This has reference to your letter requesting for this Department's legal opinion regarding the Resolution passed by the Sangguniang Panlalawigan of that province.

You stated that in a special session held on O5 February 2OOa, the Sangguniang Panlalawigan passecl "A Resolution Authorizing Goaernor

Vilma Santos Recto To Enter Iflto Cornprotnise Agreernents With Tosc. Delinquents, Subject To The Ratification Of The Sangguniang

Panlalanuigan". You altegedly opposed the passage of the said Resolution on the ground that any compromise agreements will result to a reduction or condonation of provincial taxes and will contravene an existing provincial ordinance. Such being the case, a mere Resolution will not suffice; reduction or condonation of real property taxes are only allowed under Sections 276 and 277 of the Local Oovernment Code; under Sections 152 and 192 of the same Code, taxation and/or tax reliefs are legislative functions and as such, cannot be delegated to the Covernor; and assuming that it crn be delegated, the delegation should be complete in all its essential terans and conditions so that there will be nothing left for the delegate to do but to enforce it in accordance with the established
standards set therein.

It is now your contention that said Resolution

passed

by

that

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(b) the sariggunian is ultra vires because: (a) it is a mere Resolution; intention to enter into compromise agreements with delinquent taxpayers is a dangerous practice of tax collection as taxes should be uniform and not on a case to case basis, negotiated tax compromise will open the floodgates

tograftandcomrption;(c)theResolution,evenifitcanbeconsidereda
SangguniangPanlalawigan"isnotthecompletenessandboundaries
required of a valid delegation.

valid delegation, did not set any slandards on how the compromise can be

implemenied. The clause "subject to the rqtificdtion of the

In reply, please be informed that we concur with your observations' The subject Resolution indeed appears to be ultra vires in all respects. In the case of Municipality of ParaRaque vs. V.M. Realty Qorporation (O'R' No' l27A2O,2O July l9B8), the supreme court had the occasion to distinguish an ordinance from a resolution, in this manner: "drt ordinance is a law but a resolution is merelg a declaration of the sentiment or opinion of a lano tnaking bodg on a specific natter; an ordinance possesses a general and perntanent character but a resolution is tetnporary in'nature; an ordinance prouides d pernldnent ntle of conduct or clctlon but q resolution prouides a ,r.ere opinion or uiew qnd temporarg in characteru. Additionally, "the tuo dre endcted different[g - third reading is necessa'ry for an ordina'nce but not for a resolution, unless decided otheruise bg a najoritg of all the Sanggunian mentbers". In this regard, once a provincial ordinance is
approved, nothing is left to the Covernor except his/her duty, relative to the govemance of the province, to enforce and execute the approved ordinance in accordance with the terms and conditions thereof [sec. 465 (b) (2), tocal Oovemment CodeJ.

We fulty concur with your first observation that conferment to the Qovemor of the power to enter into compromise agreements with tax delinquents cannot be done through a mere resolution. It is worth noting that with regard to Provincial Tax ordinance No. 5, s.2OO4, nothing is left anyrnore to be done by the covernor except to implement and execute the same pu rsuant to Section 465 (b) (2) of the l,ocal Government Code' It bears to emphasize however, that the said ordinance did not confer unto the Covernor the power to enter into compromise agreements with tax delinquents. Accordingly, in furtherance to the enforcement of the said tax ordinance, a subsequent Resolution authorizing the oovernor to enter into

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compromise agreements v/ith tax delinquents is not only defective as having been done by way of a mere Resolution and not in an ordinance, but it is also an undue delegation of the Sanggunian's legislative functions to the Covemor considering that, assuming that a Resolution would suffice, the same failed to provide a complete delegation of a legislative function for its failure to provide a set of standards and criteria to ensure that said power to enter into a compromise shall be reasonably exercised and that the provincial govemment is not uncluly deprived of the much lreeded revenues.

Hence, if at all the Oovernor should be empowered to enter into compromise agreement with delinquent taxpayers, said power must have been provided in the tax ordinance itself or if belatedly thought of, must be provided in a subsequent ordinance amplifying and supplementing the previous tax ordinance. Moreover, to avoid an undue delegation of legislative power and to ensure that the delegate will reasonably exercise the power, the subsequent ordinance should already set the parameters under r,vhich the power can be exercised. With respect to your second observation, it bears to stress that the l.ocal Oovemment Code, particularly Chapter lV, Section 174, provides for the civil remedies that can be availed of by the local govemment units in the collection of local tax, fees, charges and/or surcharges and interests resulting from the bax payment delinquency, to wit: (a) by administrative action thru distraint of goods and other personal property of whatever character and by Ievy upon real properties; and (b) by judicial action, meaning, filing of a collection case in court against the delinquent taxpayer. With respect to the collection of real property tax, Section 256 of the l,ocal Covemment Code provides that for the collection of real property tax and any other tax levied under Title II (Real Property Taxation) of the Local Govemment Code, the local government unit concemed may avail of the remedies by administrative action thru levy on real property or hy judicial
action.

At tlais point, it bears to stress that the Local Government Code, as a means of collecting taxes, fees or charges, did not confer any authority upon any Local Chief Dxecutive for that matter the power to enter into compromise agreement with tax clelinquents. But equally important is the fact that there is also no prohibition. tlence, we believe that if entering into compromise agreements is to be resorted to in order to avoid court

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"4litigdtions, saicl power may be properly provided for in the local tax ordin^n". itself or in any amendments made thereto' In your case' the authoritytoenterintocompromiseagreementwithdelinquenttaxpayersis contained only in a mere Resolution and was not treated as part of the original tax ordinance or even as an amendment thereto'
vis-d,vis the rernedy of judicial action to collect local taxes, fees ancl charges. In availing the remedy of judicial action, the Qovemor may enter into a compromise agreement once the collection suit has already been filed in court. But before the Oovemor can enter into the sarne, a Resolution from the Sanggunian authorizing the Covemor to enter into a compromise agreement in the judicial action is required as it involves entering into a contract which, under the l,ocal Oovernment Code, would require prior authoriw from the sanggunian. The compromise agreement shall then be submitted to the court for approval which, under the Kules of court, shall then become the court,s judgment. In this case, there is no need to pass any . ordinance vesting unto the Covemor the power to enter into compromise agreements as 'the procedure is part of the remedy of judicial action availed of Lry the local government unit.
There is, hotvever, a variation with respect to compromise agreements

Sangguniang Panlolanaigan" on any compromise entered into by the

covemor based on the Resolution passed by the sangguniang Panlalawigan cannot cure the procedural and substantive defect that such authority should be incorporated in the ordinance or in the amendments thereto'

As to your third observation, the "ratification from

the

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We hope we have enlightened you on the matter'

Very truly yours,

AUSTENE A. I'ANADFR,O tJndersecr etary. XI/,(z -f

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DlLc negional Office No. lV-A FTI Conrplex, Tag ig CitY