RECONCILING THE CONDO ACT AND NIRC FOR TAX EXEMPTION

By: Peter Irish R. De Leon, Let’s Talk Tax - BusinessWorld
Published: June 22, 2020 | 8:03 pm
Full Article: Reconciling the Condominium Act and the NIRC for tax exemption
Snippet: Well settled is the rule that tax exemptions are construed strictissimi juris against the taxpayer and liberally in favor of the government. As a result, exemptions must be shown to exist clearly and categorically, and supported by clear legal provisions. In other words, one who seeks an exemption must justify it by words “too plain to be mistaken and categorical to be misinterpreted.” Thus, the burden of proving that one is tax-exempt rests on the taxpayer.

This rigid standard for claiming tax exemption seems to imply that any doubt respecting a taxpayer’s claim for exemption should always result in a denial.

However, this is not always the case. The principles above will apply only when the taxpayer is clearly subject to the tax being levied against him. The reason is obvious: it is illogical and impractical to determine who are exempted without first determining who are covered by the provision. Thus, unless a statute imposes a tax clearly, expressly and unambiguously, what applies is the equally well-settled rule that the imposition of tax cannot be presumed. In fact, in case of doubt tax laws must be construed strictly against the government and in favor of the taxpayer.

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