Pepsi-Cola Bottling Co.

v.

City of Butuan

G.R. L-22814 (1968)

PARTIES

Pepsi Cola is a domestic

corporation with offices and

principal place in the Quezon

City,

City Butuan is a municipal

corporation headed by the City

Mayoralso defendant in this case.

FACTS

Pepsi Cola asserts that

Ordinance 122 (amended

version of Ordinance 110) is

void; hence, they are entitled

to a refund.

Ordinance 110

Taxed is imposed upon

dealers engaged in the selling

of softdrinks. (sale tax of a

merchandise)

Taxed is imposed upon agent

or consigneemerchants engaged in sale of softdrinks

are not subject to tax unless

they are agents or consignee

of another dealer, who must

be engaged in the business

outside the city.

Ordinance 122

In this case, Pepsi Cola is engaged in the

business outside the city (Quezon City) so

their consignees are compelled to pay

taxes.

ISSUES &

RULING

Is it an import

tax?

Is it unjust and

discriminatory?

The intention to limit the

softdrinks bought inside the

city from outside is apparent.

The tax partakes of an import

duty, which is beyond the

Butuans authority to impose by express provision of a law.

(RA 2264)

Yes. Uniformity is essential to

the valid exercise of power to

tax.

In this case, there is no

substantial distinctions and it

does not apply to the same

class because only the

consignees from outside the

city are required to pay tax.

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