GR L 12024; (August, 1959) (Digest)
G.R. No. L-12024; August 28, 1959
THE COLLECTOR OF INTERNAL REVENUE, petitioner, vs. PHILIPPINES INTERNATIONAL FAIR, INC. and the COURT OF TAX APPEALS, respondents.
FACTS
The respondent Philippine International Fair, Inc. sponsored an international fair and exposition in Manila in 1953. Among the attractions was the “Aquacade Show,” brought from the United States by Mr. E. K. Fernandez and exhibited in February and March 1953. After the show, Fernandez requested the Collector of Internal Revenue to exempt it from amusement tax under Republic Act No. 722 . The Collector denied the request and issued a demand for payment of P29,633.62 in tax and surcharge. The respondent’s director-general requested reconsideration, which was denied after a hearing by the Bureau of Internal Revenue’s Conference Staff. The respondent appealed to the Court of Tax Appeals. The Court of Tax Appeals resolved, based on expert witness testimony (a danseuse/ballet instructress, a businessman/newspaperman, and a veteran impresario), that the main feature of the show was “water ballet,” which falls within the concept of art. It held the show was exempt from amusement tax under Republic Act No. 722 . The Collector appealed this decision.
ISSUE
Whether the “Aquacade Show,” characterized as a “water ballet” performance, is exempt from amusement tax under the provisions of Republic Act No. 722 .
RULING
Yes. The Supreme Court affirmed the decision of the Court of Tax Appeals. The Court held that ballet is an art and, under the Constitution, arts are under the patronage of the State. Republic Act No. 722 implements this constitutional provision. Citing its prior ruling in Collector of Internal Revenue vs. Totoy Oteyza (G.R. No. L-10290, May 28, 1958), the Court stated that a ballet performance is not only an art but is also included within the terms “concerts,” “opera,” or “recital” as used in Republic Act No. 722 . Therefore, the “Aquacade Show,” as a water ballet, is exempt from the payment of amusement tax under said law. The petition was denied.