.Assoc.

of Custom Brokers v Municipal Board

(privilege tax)
Facts:
The disputed ordinance (Ordinance 3379) was passed by the Municipal Board of the City of Manila under the authority conferred by
section 18(p) of RA 409 which confers upon the municipal board the power “to tax motor and other vehicles operating within the City
of Manila the provisions of any existing law to the contrary notwithstanding. “The plaintiff, an association composed of all brokers
and public service operators of Motor Vehicles in the City of Manila filed this petition for declaratory relief challenging the validity of
the ordinance on the following grounds; that it while it levies a so-called property tax, it is in reality a license fee which is beyond the
power of the board to impose; that the said ordinance goes against the rule on uniformity of taxation; and, that the said imposition
constitutes double taxation.

Issues: Can the city validly enact such ordinance?

Held: No.
The Motor Vehicle Law (Section 70[b]) provides that no fees may be exacted or demanded for the operation of any motor vehicle
other than those therein provided , the only exception being that which refers to property tax which may be imposed by municipal
corporations. While the ordinance refers to property tax and it is fixed ad valorem, it is merely levied on motor vehicles operating
within the city of Manila with the main purpose of raising funds to be expanded exclusively for the repair, maintenance and
improvement of streets and bridges in said city. Because of this, the ordinance in question merely imposes a license fee although
under the cloak of being an ad valorem tax to circumvent the prohibition provided by the Motor VEHICLE LAW.