MIAA is not a government-owned or controlled corporation but an instrumentality of the National

Government and thus exempt from local taxation. Likewise, the real properties of MIAA are
owned by the Republic of the Philippines and thus exempt from real estate tax.

In MIAA vs. CA, the Court reiterated that under Section 2(10) and (13) of the Introductory
Provisions of the Administrative Code, which governs the legal relation and status of
government units, agencies and offices within the entire government machinery, MIAA is a
government instrumentality and not a government-owned or controlled corporation. Under
Section 133(o) of the Local Government Code, MIAA as a government instrumentality is not a
taxable person because it is not subject to "[t]axes, fees or charges of any kind" by local
governments. The only exception is when MIAA leases its real property to a "taxable person" as
provided in Section 234(a) of the Local Government Code, in which case the specific real
property leased becomes subject to real estate tax. Thus, only portions of the Airport Lands and
Buildings leased to taxable persons like private parties are subject to real estate tax, in the said
case, by the City of Paraaque.

Under Article 420 of the Civil Code, the Airport Lands and Buildings of MIAA, being devoted to
public use, are properties of public dominion and thus owned by the State or the Republic of the
Philippines. Article 420 specifically mentions "ports x x x constructed by the State," which
includes public airports and seaports, as properties of public dominion and owned by the
Republic. As properties of public dominion owned by the Republic, there is no doubt whatsoever
that the Airport Lands and Buildings are expressly exempt from real estate tax under Section
234(a) of the Local Government Code. This Court has also repeatedly ruled that properties of
public dominion are not subject to execution or foreclosure sale.

While it is true that the 1996 MCIAA vs Marcos (G.R. No. 120082) case was cited in a long line
of cases which held that MCIAA, which is placed as the same class as MIAA, was granted of
the privilege only in respect of real property tax and thus is a conclusive proof of the legislative
intent to make it a taxable person subject to all other taxes, in 2006, the Court en banc decided
the MIAA vs CA (G.R. No. 155650) that in effect reversed the 1996 MCIAA ruling. The 2006
MIAA case had, since the promulgation of the questioned Decision and Resolution, reached
finality and had in fact been either affirmed or cited in numerous cases by the Court. The
decision became final and executory on November 3, 2006. Furthermore, the 2006 MIAA case
was decided by the Court en banc while the 1996 MCIAA case was decided by a Division.
Hence, the 1996 MCIAA case should be read in light of the subsequent and unequivocal ruling
in the 2006 MIAA case. (G.R. No. 181756, 15 June 2015)