Court Dismisses Jollibee’s Local Business Tax Refund Claim

CTA Rejects Jollibee’s Local Business Tax Refund Petition

The Court of Tax Appeals (CTA) has dismissed the petition filed by Jollibee Foods Corporation (JFC) seeking a refund of over P1.4 million in alleged erroneously paid local business tax (LBT) from Parañaque City. JFC had applied for the renewal of its business permits for its branches in Parañaque City for 2022, submitting various sales certificates indicating gross sales amounting to P667,200,172.53.

Based on the sales certificates presented by JFC, Parañaque City issued Statements of Accounts (SOAs) totaling P19,213,622.92. JFC initially paid P5,590,293.68 for LBT and other local fees for the first quarter of 2022. However, JFC later sought a refund of P1,467,404.87, claiming that the LBT assessed and paid exceeded the tax based on its actual sales figures.

Legal Proceedings and Court Decisions

When the refund request was denied on May 27, 2022, JFC filed a complaint for refund before the Metropolitan Trial Court (MeTC) of Parañaque City. The MeTC dismissed the complaint on November 14, 2022, ruling that JFC failed to exhaust administrative remedies, as required under Section 196 of the Local Government Code of 1991, which sets the conditions for tax refunds or credits.

JFC then elevated the case to the CTA by filing a petition for certiorari on December 4, 2023. The company argued that the MeTC had committed grave abuse of discretion and that no plain, speedy, and adequate remedy was available. Despite this, the CTA dismissed the petition for lack of jurisdiction.

CTA Highlights Jurisdiction and Timeliness Issues

The CTA explained that even if it relaxed the rules and treated the petition as an ordinary petition for review, it would still be dismissed due to late filing. Since JFC received the order on October 4, 2023, it had until November 3, 2023, to file a petition for review before the full court. However, JFC submitted its petition only on December 4, 2023, to the CTA’s second division.

The court emphasized that because of this delay, the orders of the lower courts have become final and executory. It cited the doctrine of finality of judgment, which states that once a decision attains finality, it cannot be modified—even to correct errors in fact or law.

Final Ruling and Implications

The 14-page decision, signed by Associate Justice Corazon G. Ferrer-Flores with the concurrence of Associate Justices Ma. Belen M. Ringpis-Liban and Maria Rowena Modesto-San Pedro, upholds the finality of the lower court rulings. This dismissal means JFC will not recover the alleged excess local business tax.

Local leaders noted that this case underscores the importance of following proper administrative procedures and meeting filing deadlines when seeking tax refunds.

For more news and updates on local business tax, visit Filipinokami.com.

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