CTA orders retrial of Alaska Milk Corp. Davao tax dispute – BusinessWorld Online
THE Court of Tax Appeals (CTA) has sent back to the Davao Regional Trial Court (RTC) the 2020 case filed by Alaska Milk Corp. (AMC) seeking a refund of nearly P2.69 million in local business taxes (LBT), saying the lower court failed to hold a full trial or examine evidence before ruling on the matter.
The dispute began when the city assessed Alaska P1.86 million in LBT for 2019 and early 2020. The company paid the amount under protest, insisting that its Panacan warehouse was used solely for storage. Alaska later expanded its refund claim to P2.69 million to include payments for 2021.
Citing Section 150 of the Local Government Code, AMC argued that since no sales are made in Davao, the city has no legal basis to impose business tax. It said all sales are recorded at its principal office in Makati, not in the warehouse. City officials, however, maintained that Alaska’s Davao facility operates as a branch or sales office, noting deliveries and transactions consummated locally.
They said this makes the firm liable under the 2017 Davao Local Revenue Code.
The Davao RTC earlier ruled in favor of the city, but the CTA said the lower court decided the case without a full trial or presentation of evidence.
In a decision promulgated last Oct. 22, the appellate tax court ordered the case remanded for retrial to determine the warehouse’s actual function and the city’s authority to tax it. — Erika Mae P. Sinaking
