Republic of the Philippines

REGIONAL TRIAL COURT

National Capital Judicial Region
Taguig City, Branch 266

HANJINPHIL CORPORATION
represented by SHIELA
PANGHULAN,

Plaintiff,

- versus - Civil Case No. 166

For: Tax Refund
and/or Credit of
illegally collected
business taxes

J. VOLTAIRE L. ENRIQUEZ JR., in

his official capacity as City
Treasurer of Taguig City and the
City Government of Taguig

Defendants,

x---------------------------x

REPLY

PLAINTIFF Hanjinphil Corporation, by and through the

undersigned counsel and unto this Honorable Court, by way of Reply to
Defendants’ Answer dated 27 October 2020, most respectfully states
that:

1. On 04 November 2020, Plaintiff received a copy of the

Defendants’ Answer dated 27 October 2020.

2. The Defendants alleged therein that while Plaintiff’s Gross

Sales for the Year 2014 was One Hundred Twenty-Seven Million Five
Hundred Forty-Six Thousand Four Hundred Sixty-One Pesos and
Sixteen Centavos (Php 127,546,461.16), there is an unexplained
disparity of One Hundred Million Nune Hundred Twenty-Four
Thousand Sixty-One Pesos and Sixteen Centavos (Php 116,924,061.16)
because Plaintiff’s Gross Sale for the Year 2015 was only Ten Million Six
Hundred Twenty-Two Thousand Four Hundred Pesos (Pho 10,
622,400.00).

3. Contrary to Defendants’ allegation, Plaintiff has an existing

proof of said Gross Sales for Year 2015. The Audited Financial
Statements (AFS) for Year 2015 serves as proof of the same. The only
reason why Plaintiff has huge sales for Year 2014 because of the sale of
its building in the amount of Ninety three Million eight Hundred
Thirteen Thousand Pesos (Php 93, 813,000.00) and said sale is
supported by a Deed of Absolute Sale (DOAS) which was executed last
03 February 2014.

Copies of the foregoing AFS and DOAS are hereto attached,

marked, and made integral part hereof as Annexes “A” and
“B”, respectively.

4. It bears stressing that the crux of the matter is that the Tax
Base should not be based on the past two (2) years but only on the
immediately preceeding year. Simply put, the basis of tax collection for
the Second, Third, and Fourth Quarters of 2016 must be the Gross Sales
for 2015 and should not include the Gross Sales of 2014.

5. To reiterate, paragraph (e), Section 75 of Ordinance No. 85-

085, otherwise known as the Taguig Revenue Code, as amended, is
instructive and we quote, to wit:

Chapter 12 - Graduated Tax on Business

SECTION 75 - Imposition of Tax – There is hereby levied an

annual tax on the following businesses at rates prescribed
therefore:

e.) On Contractors and other independent contractors defined in

SECTION 74 of this Code; and on owners or operators of business
establishments rendering or offering services such as advertising
agencies, rental of space of signs, signboards, billboard or
advertisements, animal hospitals, assaying laboratories, belts and
buckle shops, blacksmith shops, bookbinders, booking offices
from film exchange, booking office for transportation on
commission basis; breeding of game cocks and other sporting
animals belonging to others; business management services;
collecting agencies; escort services; feasibility studies,
consultancy services; garages; garbage disposal contractors; gold

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 and silversmith shops; inspection services for incoming and
outgoing cargoes; interior decorating services; janitorial services;
job placements or recruitment agencies; landscaping contractors;
lathe machine shops; management consultants not subject to
professional tax; medical and dental laboratories; mercantile
agencies; messengerial services; operators of shoe shine stand;
painting shops; perma-press establishments; rent-a-plant
services; polo players; school for and/or horseback riding
academy; real estate appraisers; real estate brokerages;
photostatic; white/blue printing, photocopying, typing and
mimeographing services; car rental, rental of heavy equipment,
rental of bicycles and/or tricycles; furniture, shoes, watches,
household appliances, boats, typewriters, etc; roasting of pigs,
fowls, animals; silkscreen or T-shirt printing shops; stables; travel
agencies; vaciador shops; veterinary clinics; video rentals and/or
coverage services; dancing school/speed reading/EDP; nursery,
vocationally and other schools not regulated by the Department of
Education (DepEd), day care centers; etc., the following rates shall
apply:

Gross Sales/Receipts for the Amount of Tax

Preceding Calendar Year Per Annum

LESS than 50,000.00 EXEMPT

or more but less
50,000.00 than 75,000.00 924.00
or more but less
75,000.00 than 100,000.00 1,386.00
or more but less
100,000.00 than 150,000.00 2,079.00
or more but less
150,000.00 than 200,000.00 2,772.00
or more but less
200,000.00 than 250,000.00 3,812.00
or more but less
250,000.00 than 300,000.00 4,851.00
or more but less
300,000.00 than 400,000.00 6,468.00
or more but less
400,000.00 than 500,000.00 8,663.00
or more but less
500,000.00 than 750,000.00 9,713.00
or more but less 1,000,000.00 10,763.00

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 750,000.00 than
or more but less
1,000,000.00 than 2,000,000.00 12,075.00

2,000,000.00 or MORE Plus 65% of 1%

6. Moreover, Section 143 (e) in correlation with Section 151 of

the Local Government Code provides ---

Section 151. Scope of Taxing Powers. - Except as otherwise

provided in this Code, the city, may levy the taxes, fees, and
charges which the province or municipality may impose:
Provided, however, That the taxes, fees and charges levied and
collected by highly urbanized and independent component
cities shall accrue to them and distributed in accordance with
the provisions of this Code.

Section 143. Tax on Business. - The municipality may impose

taxes on the following businesses:

(e) On contractors and other independent contractors, in

accordance with the following schedule:

With gross sales or receipts for the preceding calendar year in the
amount of:

xxx

7. Furthermore, under Section 196 of the Local Government

Code, in order to recover taxes erroneously paid to the local
government, the taxpayer must file claim for refund and/or tax credit
with the local treasurer within two (2) years from the date of payment
of the tax. If the taxpayer wishes to elevate the matter the court, it must
likewise file within two (2)-year prescriptive period, to wit:

Section 196. Claim for Refund of Tax Credit. - No case or

proceeding shall be maintained in any court for the recovery of
any tax, fee, or charge erroneously or illegally collected until a
written claim for refund or credit has been filed with the local
treasurer. No case or proceeding shall be entertained in any
court after the expiration of two (2) years from the date of the
payment of such tax, fee, or charge, or from the date the
taxpayer is entitled to a refund or credit.

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 8. Thus, in order to recover taxes erroneously paid to the local
government, the taxpayer must file claim for refund and/or tax credit
with the local treasurer within two (2) years from the date of payment
of the tax. Thus, the instant complaint.

PRAYER

WHEREFORE, in view of the foregoing, Plaintiff

respectfully prays that the Honorable Court:

1. GRANT Plaintiff’s claim for tax refund and/or credit for business
taxes illegally collected for the period covering from 01 April
2016 – 31June 2016 for 2nd quarter, 01 July-31 September 2016
for the 3rd Quarter and 01 October-December 31, 2016 for the
fourth quarter respectively;

2. ORDER the Defendants:

a. To issue a tax refund or credit certificate in plaintiff’s favor

in the amount of as follows:
2nd Quarter Php 190,004.85
3rd Quarter Php 190,004.85
4th Quarter Php 190,004.85

Total PhP 570,014.55

b. To pay the plaintiff litigation expenses and cost of suit in

such amount as may be proved during the trial plus legal
interest of the total refundable illegally collected local
business taxes from the time demand was made.

Other reliefs just and equitable under the premises are

likewise prayed for.

Taguig City, 10 November 2020.

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 HANJINPHIL CORPORATION
3 r d Floor, HHIC Building,
1128 University Parkway,
North Bonifacio Global City,
Taguig City

By:

RO MEGAN LEA B. ABIOG

Corporate Legal Counsel of Plaintiff
Roll No. 65734
IBP No. 109176; 10 January 2020; Makati Chapter
PTR No. 8160014; 22 January 2020; Makati City
MCLE Compliance No. VI-0021605
3 r d Floor, HHIC Building,
1128 University Parkway,
North Bonifacio Global City,
Taguig City

Copy furnished:

Atty. Gary O. Palmero

City Legal Office, Taguig City Hall,
1638 Brgy. Tuktukan, Taguig City
Counsel for the Defendant

EXPLANATION

In compliance with Section 11, Rule 13 of the 1997 Rules

of Civil Procedure, the foregoing pleading was served to the
Honorable Court and to other parties by personal service.

RO MEGAN LEA B. ABIOG