The Laws of the Land

Nature and Concept of a Constitution
A constitution is a system of fundamental laws for the
governance and administration of a nation. It is supreme,
imperious, absolute and unalterable except by the authority
from which it emanates.
It has been defined as the fundamental and paramount law of the
nation. It
a) prescribes the permanent framework of a system of
government,
b) assigns to the different departments their respective
powers and duties, and
c) establishes certain fixed principles on which government
is founded.
The fundamental conception in other words is that it is a supreme
law to which all other laws must conform and in accordance with
which all private rights must be determined and all public authority
administered.

Case Digest: Carlos Superdrug Corp. v. Department of Social Welfare and Development
G.R. No.: 166494
Date of Decision: June 29, 2007
Ponente: Justice Austria-Martinez

Facts
Petitioners, composed of drugstore owners, challenged the constitutionality of Section 4(a) of Republic Act No. 9257 (The Expanded Senior Citizens Act of 2003). The provision mandates a 20% discount on the purchase of medicines by senior citizens and allows drugstores to claim the discounts as tax deductions. The petitioners argued that this scheme was confiscatory and violated the due process clause of the Constitution because the tax deduction was not a just compensation for the forced discount. They claimed that the cost of the discount was higher than the amount they could recover through the tax deduction.

Issue
Is the 20% senior citizen discount on medicines, which is treated as a tax deduction, a valid exercise of police power or an unconstitutional taking of private property without just compensation?

Ruling
The Supreme Court upheld the constitutionality of Section 4(a) of R.A. No. 9257. The Court ruled that the law is a valid exercise of the State’s police power to promote the welfare of the public, particularly a vulnerable sector like senior citizens. The provision is not a taking of private property but a regulation on the use of property for the public good.

The Court explained that the law is a social welfare legislation that seeks to promote public health. The 20% discount is a burden imposed by the State on private businesses in the exercise of its police power. The tax deduction is not a form of just compensation but a reasonable reimbursement for the costs incurred by the drugstores. It is a form of subsidy granted by the government to help businesses shoulder the cost of the mandatory discount. The State is not taking the property of the drugstores for public use; rather, it is compelling them to comply with a social policy designed to protect a vulnerable class. The Court also held that the law does not violate the equal protection clause, as the classification of senior citizens is reasonable and the mandatory discount applies to all drugstores.