a. Basic Principles and Concepts only

Basic Principles and Concepts in Taxation

Locus standi is a procedural requirement that may be relaxed when serious constitutional questions are raised and the matter is imbued with transcendental importance, overarching significance to society, or paramount public interest¹. In Tayam v. Recto, G.R. No. 280898, 22 April 2026, procedural technicalities regarding standing were set aside because the constitutionality of a tax measure directly impacted the State's taxing power, the public coffers, and the consuming public¹. On the merits, under the destination principle governing value-added tax as a tax on consumption, goods and services are taxed exclusively in the country where they are consumed; hence, goods consumed outside the Philippines are not subject to Philippine VAT on that consumption¹.

Regarding tax administration, interpretative regulations merely construe, clarify, or explain existing statutory provisions². Because they create no consequences beyond what the law already prescribes, their applicability needs nothing more than bare issuance, exempting them from requirements of public hearing, consultation, publication, or administrative registration². As held in Association of International Shipping Lines, Inc. v. Secretary of Finance and Commissioner of Internal Revenue, G.R. No. 222239, 15 January 2020, an interpretative revenue regulation does not require publication or registration with the University of the Philippines Law Center to attain effectivity².

In the taxation of international carriers, Gross Philippine Billings covers only gross revenue derived from the carriage of persons, cargo, or mail originating from the Philippines up to the final destination². Any other fees or income acquired in the normal course of trade or business, such as demurrage and detention fees, do not form part of Gross Philippine Billings and are instead subject to regular corporate income tax².