Availing of a refund from illegally collected local business tax

THE 1987 Constitution empowers local government units to create their own revenues, as well as to impose taxes, fees and charges, subject to the guidelines and limitations set forth in the Local Government Code of 1991 . The LGC defines the extent and limitations of the taxing powers of LGUs, consistent with the State's policy of upholding genuine local autonomy.

The next day, the taxpayer filed a Complaint for Refund or Credit of Local Tax and Fees before the Regional Trial Court pursuant to Section 196 of the LGC.Contrary to the position of the taxpayer, the City Treasurer claimed that the LGC does not go as far as expressly requiring the assessment to state the factual and legal basis for the taxes assessed, as it merely requires that the assessment provide the details on the nature of taxes charged and the amount of deficiency.

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