QUIZ 1

Question 1

process or means by which the sovereign through its law making body imposes burdens upon subjects and objects within its jurisdiction for the purpose of raising revenues to carry out the legitimate objects of the government.

Answer 1

Taxation

Question 2

Three Inherent Powers of the State

Answer 2

Police Power
Power of Taxation
Power of Eminent Domain

Question 2

promoting public welfare by restraining and regulating the use of liberty and property.

Answer 2

Police Power

Question 3

power of the state to acquire private property for the public purpose upon payment of just compensation.

Answer 3

Power of Eminent Domain

Question 4

The State raises revenue to defray the necessary expenses of the government.

Answer 4

Power of Taxation

Question 5

Similarities among the Three Inherent Powers of the State

Answer 5

*Inherent in the state

*Exist independently in the constitution
-conditions for their exercise may be prescribed by the constitution

*State interferes with private rights and properties

*Legislative in nature and character

*Presuppose an equivalent compensation received, directly or indirectly, by the persons affected.

Question 6

Purposes of Taxation- Primary

Answer 6

Primary : Revenue
-Provide funds of property to promote general welfare

Question 7

Purposes of Taxation- Secondary

Answer 7

Secondary : Regulatory
-Device for regulation or control

Question 8

Theory of Taxation- Necessity

Answer 8

-Preserve the state’s sovereignty
-To give protection and facilities

Question 9

Theory of Taxation- Lifeblood

Answer 9

Lifeblood Theory
-Government’s basic function

Question 10

Basis of Taxation

Answer 10

Reciprocal duties of protection and support between the state and its inahabitants.

Question 11

Manifestation of Lifeblood Theory

Answer 11

*No estoppel against the government

*Collection of taxes cannot be stopped by injunction

*Taxes could not be the subject of compensation or set-off

*Right to select objects (subjects) of taxation

*A valid tax may result in the destruction of the taxpayer’s property

Question 12

Scope of the Power of Taxation

Answer 12

*Comprehensive
*Unlimited
*Plenary
*Supreme

Question 13

Essential Elements of Tax

Answer 13

*Enforced contribution
*Payable in money
*Proportionate
*Levied on persons, property, rights
*Levied by the law-making body
*Levied for public purpose

Question 14

Aspects of Taxation

Answer 14

*Levying or imposition of Tax
*Assessment of the correct amount
*Collection of tax

Question 15

Nature/ Characteristics of the State’s Power to Tax

Answer 15

-Inherent in sovereignty
-Legislative
-Exemptions of government entities, agencies and instrumentalities
-International Comity
-Limitation of Territorial Jurisdiction
-Strongest among the inherent powers

Question 16

Exception of government entities , agencies and instrumentalities

Answer 16

-Agencies performing governmental functions
-Agencies performing propriety functions
-GOCCs
-GSIS
-SSS
-PHIC
-PCSO
-Local water District

Question 16

Exceptions to Non-Delegation Rule

Answer 16

President
Local government
Administrative agencies
Constitutional and inherent limitations

Question 17

Classification of Taxes-Scope

Answer 17

National
Local

Question 17

Classification of Taxes-Subject matter

Answer 17

Personal
Property
Excise

Question 18

Classification of Taxes-Who bears the burden

Answer 18

Direct
Indirect

Question 19

Classification of Taxes-Determination of fixed amount

Answer 19

Specific Tax
Ad valorem

Question 20

As to purpose- taxation

Answer 20

-Primary, Fiscal, or Revenue Purpose

-Secondary, Regulatory, Special or Sumptuary Purpose

Question 21

As to Graduation /rate

Answer 21

Proportional
Progressive
Regressive

Question 22

As to Taxing authority

Answer 22

National local

Question 23

Elements of Sound Tax System

Answer 23

Fiscal adequacy Theoretical justice or equity Administrative feasibility

Question 24

Limitations on the State Power to Tax

Answer 24

Inherent limitations Constitutional limitations

Question 25

Situs of Taxation

Answer 25

-Place of taxation -the state or political unit which has jurisdiction to impose a particular tax.

Question 26

Factors in Determining Situs of Taxation

Answer 26

a. Subject matter ( person, property, or activity) b. Nature of tax c. Citizenship d. Residence of the taxpayer e. Source of Income f. Place of excise, business or occupation being taxed

Question 27

Double Taxation

Answer 27

There is a burden of two or more impositions DIRECT DOUBLE TAXATION means taxing twice: 1. By the same taxing authority, jurisdiction or taxing district 2. For the same purpose 3. In the same year or taxing period 4. Same subject or object 5. Same kind or character of the tax

Question 28

Sources of Tax Laws

Answer 28

1. Constitution 2. National Internal Revenue Code 3. Tariff and Customs Code 4. Local Government Code (Book II) 5. Local tax ordinances/ City or municipal tax codes 6. Tax treaties and international agreements 7. Special Laws 8. Decision of the Supreme Court and the Court of Tax Appeals 9. Revenue rules and regulations and administrative ruling and opinion

Question 29

Tax Distinguished From Other Terms Or Imposts sum of money for the use of something

Answer 29

Toll-

Question 30

Tax Distinguished From Other Terms Or Imposts a sanction imposed as a punishment

Answer 30

Penalty -

Question 31

Tax Distinguished From Other Terms Or Imposts – proportional contribution from owners of lands for special benefits

Answer 31

-Special Assessment

Question 32

Tax Distinguished From Other Terms Or Imposts - all funds or income derived by the government

Answer 32

-Revenue

Question 33

Tax Distinguished From Other Terms Or Imposts - pecuniary aid directly granted the government to an individual or private commercial enterprise

Answer 33

-Subsidy

Question 34

Tax Distinguished From Other Terms Or Imposts - charge imposed under the police power

Answer 34

Permit/license fee

Question 35

Tax Distinguished From Other Terms Or Imposts - taxes imposed exported from or imported into a country.

Answer 35

Custom duties

Question 36

Tax Distinguished From Other Terms Or Imposts - book of rates containing kinds of merchandise with corresponding duties to pay

Answer 36

-Tariff

Question 36

Avoiding/Minimizing the Burden of Tax - transfer of tax burden

Answer 36

Shifting

Question 37

Avoiding/Minimizing the Burden of Tax - producer pays the tax and endeavor to recoup himself by improving his process of production

Answer 37

Transformation

Question 38

Avoiding/Minimizing the Burden of Tax - use of illegal means

Answer 38

Evasion

Question 39

Avoiding/Minimizing the Burden of Tax – exploitation of legally permissible alternative

Answer 39

Tax avoidance

Question 40

Avoiding/Minimizing the Burden of Tax – grant of immunity

Answer 40

Exemption

Question 41

Avoiding/Minimizing the Burden of Tax – reduction in the selling price

Answer 41

Capitalization

Question 42

Sources of Tax Laws

Answer 42

1. Constitution 2. National Internal Revenue Code 3. Tariff and Customs Code 4. Local Government Code (Book II) 5. Local tax ordinances/ City or municipal tax codes 6. Tax treaties and international agreements 7. Special Laws 8. Decision of the Supreme Court and the Court of Tax Appeals 9. Revenue rules and regulations and administrative ruling and opinion