PUBLIC SAFETY MUTUAL BENEFIT FUND, INC., REPRESENTED BY ITS PRESIDENT ANTHONY L. CUAYCONG v. ROSETTE A. LAQUIAN, Acting City Treasurer, San Juan City

CTA Form No. X(For DCC) 111111111111 111111111111111 11111 111111111111111 1111111111 11111111111111111111111 23-000 180-0025 REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY FIRST DIVISION CTA AC NO. 289 PUBLIC SAFETY MUTUAL BEN EFIT FUND, INC., REPRESENTED BY ITS PRESIDENT ANTHONY L. CUAYCONG, Petitioner, NOTICE OF RESOLUTION - versus - ROSETTE A. LAQUIAN, Acting City Tr�easurer, San Juan City, Respo nd en t. To: OFFICE OF THE SOLICITOR GENERAL 134 Amorsolo St., Lcgazpi Village Makati City ATTY. ANDREA .JUAREZ ATTY. JE 'NI FER A ' E REYES ATTY. MOHAMMAD FAYEZ 0. PAUDAC ATTY. A DREA FELIPINA B. JUAREZ City Government of San Juan 2nd 1:1oor, San Juan City Hall Pinaglabanan St. cor. P. Narciso Stro.!et San Juan City IS. ROS ETTE A. LAQUJA Ac ti ng City Treasure r C'ity Hal l Complex, Pasig City (Stationed in San Juan City) Pinaglabanan St. corner Dr. P./\. Narciso St. Barangay Cora;on de Jesus, San Juan City A BELLA, Y MANG, CAP ITA 1 and PART ' ERS (ABLY for short) Unit 204. ~nd Floor Corporate l0 l Bui ldi ng Moth.:r lgnacia, 13rgy. South Triangle Quezon City ATTY. LOURDES L. ESCU YO S l3RANCI-1CLERK OF COURT Regional Trial Court 13ranch 264. Pasig City (San Juan City Station ) GREETiNGS: You are hereby notified by these presents that on August 29, 2025,a Resolution was rendered in the above-entitled case, copy of which is attached hereto. Quezon City, Philippines, September 2, 202 Atty. Mar Executiv

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY FIRST DIVISION PUBLIC SAFETY MUTUAL CTAAC NO. 289 BENEFIT FUND, INC., REPRESENTED BY ITS Members: PRESIDENT ANTHONY L. CUAYCONG, DEL ROSARIO, I!J., Chairperson, Petitioner, BACORRO-VILLENA, and CUI-DAVID, fl. -versus- ROSETTE A. LAQUIAN, Acting City Treasurer, San Juan City, Respondent. APUrGom2u~ lgated:; Cf80AP,/1 ~ ~~ - X- - --- - -- -- - - - - - - -- - - - -- - - - - - - -- - -- -- ----X RESOLUTION BACORRO-VILLENA, L.: For the Court's resolution is respondent Rosette A. Laquian's (respondent's) "Motion for Reconsideration (of the Decision promulgated on 12 February 2 025)"1 (MR) filed personally and via email on 03 March 2025, with petitioner Public Safety Mutual Benefit Fund, Inc.'s (petitioner's) "Comment (on the Respondent's Motion for Reconsideration)"2 (Comment) filed personally and via email on 28 March 2025. The MR assails the First Division's Decision3 promulgated on 12 February 2025 (as!iailed Decision). The dispositive portion of the said Decision reads:t Division Docket, pp. 223-240. Id., pp. 246-254 . Id., pp. 194-222.

RESOLUTION CTA AC No. 289 Public Safety Mutual Benefit Fund, Inc. Represented by its President Anthony L. Cuaycong v. Rosette A. Laquian, Acting City Treasurer, San juan City Page 2 of6 x-------------------------------------------------------------x WHEREFORE, the foregoing premises considered, the present Petition for Review filed by petitioner Public Safety Mutual [Benefit] Fund, Inc. on 24 April 2023 is PARTIALLY GRANTED. The assailed Decision dated 13 June 2022 and Order dated 03 October 2022, both rendered by the Regional Trial Court of the City of Pasig, Branch 264 in Civil Case No. 75517-SJ, entitled Public Safety Mutual Benefit Fund, Inc. represented by its Vice President Armando E. Ramolete v. Rosette F. Laquian, City Treasurer ofSan Juan City, are hereby REVERSED and SET ASIDE. Accordingly, the subject Tax Order of Payment dated 07 January 2020 is CANCELLED. Respondent is ORDERED TO REFUND petitioner the amount of 1'21,436,732�40, representing petitioner's erroneously or illegally collected Local Business Tax for the calendar year ended 31 December 2020. SO ORDERED. In the MR, respondent foremost disagrees with the Court's finding that petitioner is not engaged in business as a bank or financial institution and that it is not an insurance company. Respondent points out that, in the case of City of Davao, et a/. v. Randy Allied Ventures, Inc.4 (RAVI), as cited in the ponencia, the Supreme Court did not deem the respondent therein as "doing business" as a financial institution as it only earned dividends incident to its primary purpose. For respondent, the aforementioned ruling is inapplicable to the instant case as herein petitioner generates revenue through the collection of insurance premiums in line with its primary purpose (as opposed to incidental earnings by a holding company as in the RAVI case). Respondent insinuates that petitioner is doing business as a financial institution as it is operating akin to an insurance company. She highlights that petitioner openly admitted in its Petition for Review that it carries out an insurance company's activities. Respondent further ast argues that petitioner should not be exempted from local business tax (LBT) simply because it is a nonprofit entity. In line with this, - respondent concludes that petitioner is subject to LBT, particularly G.R. No. 241697.29 July 2019.

RESOLUTION CTA AC No. 289 Public Safety Mutual Benefit Fund, Inc Represented hy its President Anthony L. Cuaycong v. Rosette A Laquian, Acting City Treasurer, San juan City x-------------------------------------------------------------x the latter had not cited any legal basis justifying its claim of exemption from LBT. For her part, respondent submits that the Tax Orders of Payment (TOPs) issued in the present case are valid and legaL On the other hand, in its Comment, pet1t10ner refers to the provisions of the Insurance Code as a special law vis-a-vis those of the Local Government Code of 1991 (LGC) as a general law. Petitioner cites Section 403 of the Insurance Code, which defines "mutual benefit associations" in relation to Section 190 of the same Code, which defines "insurance companies", and excepting mutual benefit associations from the definition thereof: Sec. 190. For purposes of this Code, the term insurer or insurance company shall include all partnerships, associations, cooperatives or corporations, including government-owned or -controlled corporations or entities, engaged as principals in the insurance business, excepting mutual benefit associations. Sec. 403. Any society, assoCiatwn or corporation, without capital stock, formed or organized not for profit but mainly for the purpose of paying sick benefits to members, or of furnishing financial support to members while out of employment, or of paying to relatives of deceased members of fixed or any sum of money, irrespective of whether such aim or purpose is carried out by means of fixed dues or assessments collected regularly from the members, or of providing, by the issuance of certificates of insurance, payment of its members of accident or life insurance benefits out of such fixed and regular dues or assessments, but in no case shall include any society, association, or corporation with such mutual benefit features and which shall be carried out purely from volunta1y contributions collected not regularly and/or no fixed amount from whomsoever may contribute, shall be known as a mutual benefit association within the intent of this Code.' Petitioner likewise explains that its Articles of Incorporation specified that it operated only for the exclusive benefit of its members, U in line with the definition of a mutual benefit association. It adds that~ as a nonstock, nonprofit company, it cannot distribute profits through Emphasis supplied and italics in the original text.

RESOLUTION CTA AC No. 289 Public Safety Mutual Benefit Fund, Inc. Represented by its President Anthony L. Cuaycong v. Rosette A. Laquian, Acting City Treasurer, San juan City x-------------------------------------------------------------x dividends and thus cannot be considered to be engaged in business for profit, for purposes of determining whether its activities are subject to LBT. We resolve. The crux of respondent's line of argument in the MR lies in the allegation that petitioner is a financial institution engaged in insurance business. Verily, the same had already been addressed in the assailed Decision. As resolved and discussed in the assailed Decision, respondent's LBT assessments against petitioner were invalid as they were issued beyond the scope of the City of San Juan's authority to tax under the LGC. With petitioner not being an insurance company (and, in fact, specifically excepted by the nature of its operations), the City ofSan Juan cannot tax petitioner as such. The Court thus finds no cogent reason to vacate its earlier ruling. As petitioner aptly pointed out, a plain reading of the pertinent provisions in the Insurance Code (i.e. Sections 109 and 403) clearly shows that entities that carry out activities similar to those of an insurance company, but are organized not for profit but mainly for the purpose of providing benefits of its members, are not insurance companies but mutual benefit associations.6 While the Insurance Code's provisions, by themselves, are already sufficient to advance the conclusion that petitioner is not subject to LBT; those of the LGC and the City of San Juan Revenue Code similarly support this view. To recapitulate, the City of SanJuan Revenue Code of 2013 mirrored the LGC in defining "business" and "banks and other financial institutions", to wit: ARTICLE B t. Definition and Rules ofConstruction SECTION 1B.oi. Definitions.- When used in this Code, the term: 6 Supra at page 3.

RESOLUTION CTA AC No. 289 Public Safety Mutual Benefit Fund, Inc Represented by its President Anthony L. Cuaycong v. Rosette A Laquian, Acting City Treasurer, San juan City Page 5 of6 x-------------------------------------------------------------x Business - means trade or commercial activity regularly engaged in as means of livelihood or with a view to profit. Banks and Other Financial Institutions - include non-bank financial intermediaries, lending investor, finance and investment companies, pawnshops, money shops, insurance companies, stock markets, stock brokers and dealers in securities and foreign exchange, as define under applicable laws or rules and regulations thereunder/ As can be gleaned from the foregoing, the Code relies on supplemental definitions "under applicable laws, or rules and regulations thereunder". For this purpose, the Insurance Code's provisions are indeed authoritative. Respondent, in the MR, also erroneously questioned the citation of the RAVI case, wherein the Supreme Court ruled that a nonbank financial instution cannot be held liable for LBT. It made clear that persons made liable for LBT, in this case, are banks or other financial institutions by virtue of their being engaged in the business as such. As concluded in the assailed Decision, petitioner falls outside the definition of"banks and other financial institutions". Contrary to respondent's positiOn (that petitioner's supposed "insurance" activities meant that it is doing business as an insurance company), in line with the discussions further above, petitioner's activities are not subject to LBT. Clearly, respondent's position has no basis in law. WHEREFORE, in view of the foregoing, respondent Rosette A. Laquian's "Motion for Reconsideration (of the Decision promulgated on 12 Februa1y 2025)" filed on 03 March 2025 is DENIED for lack of merit. SO ORDERED. Emphasis and italics in the original text: underscoring supplied.

RESOLUTION CTA AC No. 289 Public Safety Mutual Benefit Fund, Inc. Rept�esented by its President Anthony L. Cuaycong v. Rosette A. Laquian, Acting City Treasurer, San Juan City Page 6 of6 x-------------------------------------------------------------x WE CONCUR: Presiding Justice ~MIL LANEE S. CUI-DAVID Associate Justice