Osmeña v. Orbos
G.R. No.
99886 March 31, 1993
Narvasa,
C.J.
Facts:
On October 10, 1984, Pres. Marcos
issued P.D. 1956 creating a Special Account in the General Fund, designated as the
Oil Price Stabilization Fund (OPSF). The OPSF was designed to reimburse oil companies
for cost increases in crude oil and imported petroleum products resulting from exchange
rate adjustments and from increases in the world market prices of crude oil.
Subsequently, the OPSF was reclassified
into a “trust liability account,” in virtue of E.O. 1024, and ordered released from
the National Treasury to the Ministry of Energy.
Pres. Aquino, amended P.D. 1956.
She promulgated Executive Order No. 137 on February 27, 1987, expanding the grounds
for reimbursement to oil companies for possible cost underrecovery incurred as a
result of the reduction of domestic prices of petroleum products, the amount of
the underrecovery being left for determination by the Ministry of Finance.
The petition avers that the creation
of the trust fund violates 29(3), Article VI of the Constitution, reading as follows:
(3) All money collected on any tax levied for a special
purpose shall be treated as a special fund and paid out for such purposes only.
If the purpose for which a special fund was created has been fulfilled or abandoned,
the balance, if any, shall be transferred to the general funds of the Government.
The petitioner argues that “the monies
collected pursuant to . . P.D. 1956, as amended, must be treated as a ‘SPECIAL FUND,’
not as a ‘trust account’ or a ‘trust fund,’ and that “if a special tax is collected
for a specific purpose, the revenue generated therefrom shall ‘be treated as a special
fund’ to be used only for the purpose indicated, and not channeled to another government
objective.” Petitioner further points out that since “a ‘special fund’ consists
of monies collected through the taxing power of a State, such amounts belong to
the State, although the use thereof is limited to the special purpose/objective
for which it was created.”
He also contends that the “delegation
of legislative authority” to the ERB violates 28 (2). Article VI of the Constitution,
viz.:
(2) The Congress may, by law, authorize the President
to fix, within specified limits, and subject to such limitations and restrictions
as it may impose, tariff rates, import and export quotas, tonnage and wharfage dues,
and other duties or imposts within the framework of the national development program
of the Government;
and, inasmuch as
the delegation relates to the exercise of the power of taxation, “the limits, limitations
and restrictions must be quantitative, that is, the law must not only specify how
to tax, who (shall) be taxed (and) what the tax is for, but also impose a specific
limit on how much to tax.”
Issue:
whether or Not the invalidity of
the “TRUST ACCOUNT” in the books of account of the Ministry of Energy (now, the
Office of Energy Affairs), created pursuant to § 8, paragraph 1, of P.D. No. 1956,
as amended, “said creation of a trust fund being contrary to Section 29 (3), Article
VI of the Constitution
Held:
The OPSF is a “Trust Account” which
was established “for the purpose of minimizing the frequent price changes brought
about by exchange rate adjustment and/or changes in world market prices of crude
oil and imported petroleum products.” Under P.D. No. 1956, as amended by Executive
Order No. 137 dated 27 February 1987, this Trust Account may be funded from any
of the following sources:
a)
Any increase
in the tax collection from ad valorem tax or customs duty imposed on petroleum products
subject to tax under this Decree arising from exchange rate adjustment, as may be
determined by the Minister of Finance in consultation with the Board of Energy;
b)
Any increase
in the tax collection as a result of the lifting of tax exemptions of government
corporations, as may be determined by the Minister of Finance in consultation with
the Board of Energy;
c)
Any additional
amount to be imposed on petroleum products to augment the resources of the Fund
through an appropriate Order that may be issued by the Board of Energy requiring
payment of persons or companies engaged in the business of importing, manufacturing
and/or marketing petroleum products;
d)
Any resulting
peso cost differentials in case the actual peso costs paid by oil companies in the
importation of crude oil and petroleum products is less than the peso costs computed
using the reference foreign exchange rate as fixed by the Board of Energy.
Hence, it seems clear that while
the funds collected may be referred to as taxes, they are exacted in the exercise
of the police power of the State. Moreover, that the OPSF is a special fund is plain
from the special treatment given it by E.O. 137. It is segregated from the general
fund; and while it is placed in what the law refers to as a “trust liability account,”
the fund nonetheless remains subject to the scrutiny and review of the COA. The
Court is satisfied that these measures comply with the constitutional description
of a “special fund.” Indeed, the practice is not without precedent.
Issue:
whether or Not the unconstitutionality
of 8, paragraph 1 (c) of P.D. No. 1956, as amended by Executive Order No. 137, for
“being an undue and invalid delegation of legislative power to the Energy Regulatory
Board
Held:
The Court finds that the provision
conferring the authority upon the ERB to impose additional amounts on petroleum
products provides a sufficient standard by which the authority must be exercised.
In addition to the general policy of the law to protect the local consumer by stabilizing
and subsidizing domestic pump rates, § 8(c) of P.D. 1956 expressly authorizes the
ERB to impose additional amounts to augment the resources of the Fund.
What petitioner would wish is the
fixing of some definite, quantitative restriction, or “a specific limit on how much
to tax.” The Court is cited to this requirement by the petitioner on the premise
that what is involved here is the power of taxation; but as already discussed, this
is not the case. What is here involved is not so much the power of taxation as police
power. Although the provision authorizing the ERB to impose additional amounts could
be construed to refer to the power of taxation, it cannot be overlooked that the
overriding consideration is to enable the delegate to act with expediency in carrying
out the objectives of the law which are embraced by the police power of the State.
The interplay and constant fluctuation
of the various factors involved in the determination of the price of oil and petroleum
products, and the frequently shifting need to either augment or exhaust the Fund,
do not conveniently permit the setting of fixed or rigid parameters in the law as
proposed by the petitioner. To do so would render the ERB unable to respond effectively
so as to mitigate or avoid the undesirable consequences of such fluidity. As such,
the standard as it is expressed suffices to guide the delegate in the exercise of
the delegated power, taking account of the circumstances under which it is to be
exercised.
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