Jurisdiction over criminal offenses entailing tax claims

In continuation of the previous article, the Supreme Court (SC) in the consolidated cases of People v. Mendez and Mendez v. People (G.R. Nos. 208310-11 and 208662, 28 March 2023), also resolved the issue on which court has jurisdiction over criminal offenses entailing tax claims amounting to P1,000,000 and above. 

In Mendez’s petition, he insisted that the Court of Tax Appeals (CTA) had no jurisdiction over the criminal case because the amounts stated in the Amended Information are mere estimates. Mendez claimed that the CTA has original jurisdiction over a criminal case only when the principal amount of tax is at least P1,000,000; otherwise, the original jurisdiction is with the regular courts, and the jurisdiction of the CTA shall be appellate.

The SC acknowledged a conflict between RA 9282 (An Act Expanding the Jurisdiction of the CTA) and RA 11576 (An Act Further Expanding the Jurisdiction of the MeTC, MTCC, MTC and MCTC).

Under RA 9282, as to criminal offenses with an attendant claim amounting to P1,000,000 or more, exclusive original jurisdiction is vested with the CTA Division. Tax claims amounting below P1,000,000 or there is no specified amount or attendant claim, as when the offense is only punishable by a fine and/or imprisonment, original jurisdiction is vested with the regular courts.

The SC explained that upon the effectivity of RA 11576 on 21 August 2021, the threshold values for civil cases falling within the exclusive original jurisdiction of the first and second level were increased, causing an overlap with respect to the jurisdiction of the CTA and the regular trial courts. 

As provided under RA 11576, exclusive original jurisdiction over civil actions involving claims amounting to P2,000,000 and below shall be with the first-level courts, while those claims amounting to more than P2,000,000 shall be with the regional trial courts.

Thus, in reconciling RA 9282 and RA 11576, the SC provided the following guidelines:

a. Exclusive original jurisdiction over tax collection cases involving P1,000,000 or more remains with the CTA; 

b. Exclusive original jurisdiction over tax collection cases involving less than P1,000,000 shall be exercised by the proper first-level courts; 

c. Exclusive appellate jurisdiction over tax collection cases originally decided by the first-level courts shall be exercised by the RTC;

d. Exclusive original jurisdiction over criminal offenses or felonies where the principal amount of taxes and fees, exclusive of charges and penalties, claimed is P1,000,000 or more remains with the CTA; 

e. Exclusive original jurisdiction over criminal offenses or felonies where the principal amount of taxes and fees, exclusive of charges and penalties, claimed is less than P1,000,000 shall be exercised by the proper first-level courts; and 

f. Exclusive appellate jurisdiction over criminal offenses or felonies initially decided by the first-level courts remains with the RTC.

The High Court, however, emphasized that the foregoing guidelines shall apply to cases filed upon the effectivity of RA 11576 on 21 August 2021, pursuant to the principle that “jurisdiction over the subject matter in criminal cases is determined by the statute in force at the time of commencement of the action.”

In debunking Mendez’s argument that the CTA has no jurisdiction, the SC ruled that the CTA had jurisdiction over the two criminal cases filed against Mendez pursuant to RA 9282, the statute in force when the criminal actions at the bar were instituted.

For more of Dean Nilo Divina’s legal tidbits, please visit www.divinalaw.com. For comments and questions, please send an email to cabdo@divinalaw.com.