The principle of fiscal legality is attributed to the provisions of our article 52 of the Constitution in that it clearly states that the creation of national taxes can only be done by the instrument of the law and not by a norm of the lower hierarchy such as an executive decree or a resolution. The recognition of the flexibility of the principle of fiscal legality and legal reserve results from the power conferred on the executive body to issue decrees with the force of law for a limited period and with defined objectives in case of emergency, emergency or force majeure to protect the national economy, which is not new in Panama in fiscal matters, since today we can mention, among other decrees, Ministerial Decree 109 of 1970, by which the General Directorate of Revenue was reorganized, and that the Supreme Court of Panama established and confirmed its legal force, and in this norm most of the powers of the Panama Tax Administration are collected until today and until the Panamanian Code of Tax Procedure enters fully into force. The importance of the principle of legality is undisputed in all areas, but especially in administrative law. Among other things, because the administration must adhere to a hierarchical legal system according to this principle. However, it should be noted that when the alleged unconstitutionality of a law or part thereof is ± established, the so-called principle of universality or the principle of full interpretation of the Constitution must be taken into account, suggesting that if a constitutional norm is required or cited as violated, the analysis should not focus on that norm alone. but with all the articles of the Constitution. The principle of legality consists in giving precedence to the law over any activity or function of public authority. Within the framework of the principle of legality, it acts in conjunction with the principle of the general interest, according to which the private interest must give way to the public or social interest, and with the principle of the separation of powers, according to which the public authority is divided into bodies with specific and limited functions for each of them. This norm establishes the exception to the principle of legality of the will of the National Assembly of Panama in situations of national emergency since ±2019 ± the entry into force of Law 66 of 2017. This is one of the principles on which administrative law is based, that is, that applicable to public administration.
On numerous occasions, the case-law developed by this body has had occasion to reaffirm the predominance of the principle of statutory tax moderation over certain initiatives aimed at introducing provisions relating to substantive aspects of taxation or to the powers of regulatory interpretation by administrative authorities of the meaning and scope of tax rules. On the other hand, it is assumed that the principle of fiscal moderation in Panama is enshrined in Article 159, paragraph 10, which provides that the initial fiscal power to create national taxes is reserved exclusively to the National Assembly of Panama, so that this power is excluded from any other organ of the State such as the executive body. According to the principle of legality in criminal law: Article 9 – Exception to the principle of legality. The executive branch may suspend, in whole or in part, the application of taxes of any kind and, in the event of a state of emergency declared by law, temporarily defer their payment throughout the national territory or in certain regions.