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    Sanchez v. Collector of Internal Revenue

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    Emil Bautista
    - Sanchez owns a four-unit apartment building that she constructed for the purpose of renting out to tenants. She lives in one unit and rents out the other three. - The court found that Sanchez meets the definition of a real estate dealer under the law and is therefore subject to the real estate dealer's tax. - While Sanchez argued this amounts to double taxation along with the real estate tax she pays, the court rejected this argument and cited precedent that a license or occupation tax can be charged in addition to property taxes on the same property. However, Sanchez is entitled to a partial refund for taxes paid for a year before her property was constructed.

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    Sanchez v. Collector of Internal Revenue

    Uploaded by

    Emil Bautista
    137 views1 page
    - Sanchez owns a four-unit apartment building that she constructed for the purpose of renting out to tenants. She lives in one unit and rents out the other three. - The court found that Sanchez meets the definition of a real estate dealer under the law and is therefore subject to the real estate dealer's tax. - While Sanchez argued this amounts to double taxation along with the real estate tax she pays, the court rejected this argument and cited precedent that a license or occupation tax can be charged in addition to property taxes on the same property. However, Sanchez is entitled to a partial refund for taxes paid for a year before her property was constructed.

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    - Sanchez owns a four-unit apartment building that she constructed for the purpose of renting out to tenants. She lives in one unit and rents out the other three. - The court found that Sanchez meets the definition of a real estate dealer under the law and is therefore subject to the real estate dealer's tax. - While Sanchez argued this amounts to double taxation along with the real estate tax she pays, the court rejected this argument and cited precedent that a license or occupation tax can be charged in addition to property taxes on the same property. However, Sanchez is entitled to a partial refund for taxes paid for a year before her property was constructed.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    137 views1 page

    Sanchez v. Collector of Internal Revenue

    Uploaded by

    Emil Bautista
    - Sanchez owns a four-unit apartment building that she constructed for the purpose of renting out to tenants. She lives in one unit and rents out the other three. - The court found that Sanchez meets the definition of a real estate dealer under the law and is therefore subject to the real estate dealer's tax. - While Sanchez argued this amounts to double taxation along with the real estate tax she pays, the court rejected this argument and cited precedent that a license or occupation tax can be charged in addition to property taxes on the same property. However, Sanchez is entitled to a partial refund for taxes paid for a year before her property was constructed.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    (Sanchez v. Collector of Internal Revenue, G.R. No.

    L-7521, October 18, 1955, 97 Phil 867)

    SYLLABUS

    1. TAXATION; REAL ESTATE DEALER'S TAX; PERSONS SUBJECT THERETO. — Considering that
    appellants constructed her four-door "accessoria purposely for rent or profit; that she has been continuously leasing
    the same to third persons since its construction in 1947; that she manages her property herself; and that said
    leased holding appears to her main source of livelihood, she is engaged in the leasing of real estate, and is a real
    estate dealer as defined by section 194(s) of the Internal Revenue Code, as amended by Republic Act No. 42.
    2. ID.; TAXATION; SEPARATED TAX LEVIED UPON A BUSINESS OR OCCUPATION AND THE
    PROPERTY USED THEREIN DOES NOT AMOUNT TO DOUBLE TAXATION. — A license tax may be levied
    upon a business or occupation although the land or property used therein is subject to property tax; and the state
    may collect an ad valorem tax on property used in a calling, and at the same time impose a license tax on the
    pursuit of that calling, the imposition of the latter kind of tax being in no sense a double tax.

    DECISION

    REYES, J.B.L., J p:

    - Sanchez is the owner of a two-story, four-door "accessoria" building.


    - The building has an assessed value of P21,540 and the land is assessed at P7,980,
    - The appellant lives in one of the apartments, she is renting the rest to other persons.
    - Sanchez also runs a small dry goods store in the Pasay market
    - CIR made demand upon appellant for the payment for income tax and real estate dealer's tax.
    - Appellant paid the taxes demanded under protest,
    - Sanchez filed action against the CIR for the refund of the taxes paid,
    - RTC found Sanchez to be a dealer, subjected to the real estate dealer tax
    - The RTC aapplied the definition of "real estate dealer" “Real estate dealers' includes all persons who for their
    own account are engaged in the sale of lands, buildings or interests therein or in leasing real estate." (R. A.
    No. 42)

    ISSSUE: Does appellant fall within the above definition? YES


    HELD: We are of the opinion that she does. The kind and nature of the building constructed by her — which is a
    four-door "accessoria" — shows that it was from the beginning intended for lease as a source of income or profit to
    the owner; and while appellant resides in one of the apartments, it appears that she always rented the other
    apartments to other persons from the time the building was constructed up to the time of the filing of this case.
    Is there double Taxation (Real Estate + Dealers Tax)
    - Sanchez argues that she is already paying real estate taxes on her property, as well as income tax.
    - "real estate dealers' tax" amounts to double taxation.
    - This argument has already been rejected by this Court in the case of People vs. Mendaros, where we held
    that "it is a well settled rule that license tax may be levied upon a business or occupation although the
    land or property used therein is subject to property tax", and that "the state may collect an ad valorem
    tax on property used in a calling, and at the same time impose a license tax on the pursuit of that
    calling", the imposition of the latter kind of tax being in no sense a double tax.
    The evidence shows, however, that the apartment house in question was constructed only in 1947, while
    the real estate dealer's tax demanded of and paid by appellant was for the years 1946 to 1950 (see Exhibit 4).
    Wherefore, appellant is entitled to a refund of the tax paid for the year 1946, amounting to P37.50.
    With the modification that the appellee Collector of Internal Revenue is ordered to refund to appellant
    Veronica Sanchez the amount of P37.50 paid as real estate dealer's tax for the year 1946, the decision appealed
    from is, in all other respects, affirmed. Costs against appellant. So ordered.
    Bengzon, Acting C.J., Padilla, Montemayor, Reyes, A., Jugo, Bautista Angelo and Concepcion, JJ., concur.

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