Estrada ignores De Lima, as SM battles Manila’s ’confiscatory’ tax hike
The SM Group like many Chinoy businesses is not known for taking City Hall to court, especially when the mayor not only happens to be the former President whose political reach still extends to the Senate and, of course, neighboring San Juan. But it did.
This littleknown side of SM has emerged after the Manila City Council , at the behest of Mayor Jos eph Estrada, increased beginning 2014 the local business tax rates to as much as three percent of annual gross sales from only 0.2 percent under the long - reign of Estrada’s predecessor, Alfredo Lim.
Estrada, who claimed that he had inherited a “bankrupt” City Hall and therefore needed to raise revenues, ignored SM’s protestations and pushed through with the rate increase.
The SM Group, which had managed to keep the tax battle out of the business press, then appealed and found a sympathetic ear in Justice Secretary Leila de Lima, who ruled against Estrada and voided the Manila ordinance.
The Estrada administration had exceeded the 10 percent limit on any rate increase imposed by the Local Government Code, De Lima said, upholding the SM appeal that the new Manila tax rates were “confiscatory and in restraint of trade.”
A determined Estrada then sued SM and De Lima before the Manila Regional Trial Court, but Judge Acerey Pacheco, claiming that the Estrada administration had failed to exhaust the administrative remedies, dismissed the City Hall petition on a technicality.
Claiming the court has no jurisdiction yet, the judge ruled that Estrada should first appeal De Lima’s decision before her office and thence, after another repudiation, elevate the issue to Malacañang before seeking relief from the judiciary.
Put another way, Pacheco, counsel to the bankrupt Orient Bank and developer Jose Go of Ever-Gotesco before his promotion to the judiciary, effectively ruled that De Lima’s pro-SM decision still stands.
In the latest twist, it was the turn of the Manila judge to be served with humble pie after the Court of Appeals, in a decision released last week, lectured Pacheco that he could not dismiss such a paramount case “on such flimsy and tenuous ground” as prematurity.
Besides, the Local Government Code was quite specific in stipulating that the remedy from the decision of the DOJ Secretary lies with “a court of competent jurisdiction,” which obviously is not the Office of the President as Pacheco had ruled, said appellate justice Remedios Salazar-Fernando.
Salazar-Fernando, together with associate justices Priscilla Baltazar-Padilla and Socorro Inting, then had the case remanded to Pacheco, ordering the judge to re-hear the case “with dispatch.”
Heard through the grapevine
Former Misamis Oriental congressman Augusto Baculio has taken over by force the open parking lot of the Concorde office condominium in Makati’s Legaspi Village.
Claiming that he had acquired the 1970s-era Concorde developer, Pulp and Paper Inc., from its creditor, the Philippine National Bank, Baculio now says that he also owns the seven-story condo building despite all its units having been sold by the original developer to thirdparty buyers four decades ago.