Taxation 101

Question 1

An enforced proportional contribution, imposed by the state in its sovereign capacity, to support the government

Answer 1

Taxation

Question 2

What are the elements of taxation

Answer 2

Imposed proportional contribution from people and property
Enforced by the state in virtue of its sovereignty
For the support of the government

Question 3

Through which the government and its agencies continue to operate and with which the state effects its functions for the welfare of its constituents

Answer 3

Lifeblood theory

Question 4

Sometimes called the power to destroy

Answer 4

Power of taxation

Question 5

What are the attributes of sound taxation system

Answer 5

Fiscal adequacy
Administrative feasibility
Theoretical justice

Question 6

The sources of revenue should be adequate to meet government expenditures and their variations

Answer 6

Fiscal adaquacy

Question 7

The tax system should be capable of being effectively administered and enforced with the least inconvenience to the taxpayer

Answer 7

Administrative feasibility

Question 8

The tax system should be fair to the average taxpayer and based upon the ability to pay

Answer 8

Theoretical justice

Question 9

What are the inherent limits of the power to tax

Answer 9

1 Taxes must be exacted for Public purpose
2 The power to tax is Inherently legislative in nature
3 government entities, agencies, and instrumentalities are generally exempt from taxation
4 international comity
5 taxes are limited to the state’s territorial jurisdiction

Question 10

Money raised by taxation can be spent only on public purposes and not for the advantage of private individuals

Answer 10

Taxes must be exacted for a public purpose

Question 11

What are the exemptions of power to tax

Answer 11

Delegation to local government
Delegation to the president
Delegation to administrative agencies

Question 12

Exemption of the government taxation

Answer 12

Government owned or controlled corporations are not exempt from real property taxes

Question 13

It refers to te respect accorded by nations to each other because they are sovereign equals. Thus, the property or income of a foreign state may not be the subject of taxation by another state.

Answer 13

International comity

Question 14

What is the exemption to the territorial jurisdiction

Answer 14

Relationship exists between the state and the taxpayer

Question 15

What are the 2 types of due process

Answer 15

Substantive due process
Procedural due process

Question 16

The law must be reasonable and it must be for a public purpose

Answer 16

Substantive due process

Question 17

There must be no arbitrariness in the assessment and collection

Answer 17

Procedural due process

Question 18

It means that all persons subjected to such legislation shall be treated alike, under like circumstances and conditions, both in the privileges conferred and, in the liabilities, imposed.

Answer 18

Equal protection of laws

Question 19

Exemption of tax under the religious freedom

Answer 19

Income of religious organizations from activities conducted for profit or from any of their property is subject to impncome tax

Question 20

What is poll tax

Answer 20

Cedilla or residence tax

Question 21

Are levied on individuals or organizations and must be paid directly to the government

Answer 21

Direct and indirect taxes

Question 22

They include income tax, wealth tax, corporate tax, etc.

Answer 22

Direct and indirect tax

Question 23

Are levied on goods and services and are collected by an intermediary from the person who bears the ultimate economic burden of the tax

Answer 23

Indirect tax

Question 24

Increases as the taxable amount increases, meaning those with higher income pay a higher percentage of their income in tax

Answer 24

Progressive

Question 25

Takes a larger percentage of income from low- income earners than from high income

Answer 25

Regressive tax

Question 26

Also known as flat tax, levies the same percentage rate of taxation on everyone, regardless of income

Answer 26

Proportional tax

Question 27

Levied based on the value of the goods or property

Answer 27

Ad valorem

Question 28

Are levied based on quantity, such as excise taxes and fuel or cigarettes

Answer 28

Specific taxes

Question 29

Are levied on the consumption of goods and services and include sales taxes and vat

Answer 29

Consumption taxes

Question 30

Levied on the income of individuals and businesses

Answer 30

Income taxes

Question 31

Are levied on the profits of business

Answer 31

Corporate taxes

Question 32

Levied on individuals income

Answer 32

Personal taxes

Question 33

What are the Classification of taxes

Answer 33

Direct and indirect taxes Progressive, regressive, and proportional taxes An valorem and specific taxes Consumption and income taxes Corporate and personal taxes

Question 34

A tax on all yearly profits arising from property, professional, trade, or business, or a tax on persons income, emoluments, profits and the like

Answer 34

Income tax

Question 35

Is in the nature of an exercise taxation system, or taxation on the exercise of privileges, the privilege to earn yearly profits from various sources. It is a soupy stem that does not provide for the taxation of property

Answer 35

Income taxation

Question 36

Refers to all wealth which flows into the taxpayer other than as mere return of capital. It includes the forms of income specifically described as gains and profits, including gains derived from the sale or other disposition of capital assets

Answer 36

Income

Question 37

Is a flow of service rendered by capital by payment of money from it or any benefit rendered by a fund of capital in relation to such fund through a period of time

Answer 37

Income

Question 38

A primary consideration in income taxation is that there must be income before there could be income taxation

Answer 38

Existence of income

Question 39

The earning process is complete or virtually complete An exchange has taken place

Answer 39

Realization of income

Question 40

If actually or physically received by taxpayer If constructively received by taxpayer

Answer 40

Recognition income

Question 41

It is the place or authority that has the right to impose and collect taxes

Answer 41

Situs of taxation

Question 42

What are the factors to determine the situs of taxation

Answer 42

Residence of the taxpayers Citizenship of the taxpayer Nature of the tax Subject matter of the tax Source of income

Question 43

Is a tax imposed by your local government unit that property owners must pay annually

Answer 43

Real estate property tax

Question 44

The transmission of properties from a descendent to his heirs

Answer 44

Estate tax

Question 45

Levied on the transmission of properties from a living person to another living person

Answer 45

Donors tax

Question 46

What are the elements of a donation

Answer 46

Reduction of the patrimony of the donor Increase of the patrimony of donee Intent to do an act of liberality or animus donandi

Question 47

What are the essential requisites of a taxable donation

Answer 47

1 Capacity of the donor or the legal ability of the donor to enter into a valid contract 2 donative intent 3 delivery, whether actual or constructive, of the subject matter 4 acceptance of the gift by the donee

Question 48

Is a business tax imposed and collected on every sale, barter, or exchange of goods or properties (real or personal), lease of goods or properties, renditions of services, all in the course of trade or business, importation of goods

Answer 48

Vat or value added tax

Question 49

It is an indirect tax that may be shifted or passed on to the buys, transferee or lessee of goods, properties or services.

Answer 49

Value added tax

Question 50

This usually refers to redistribution of land from the rich to the poor

Answer 50

Agrarian reforms

Question 51

It includes regulation of ownership, operation, leasing, sales, and inheritance of land

Answer 51

Agrarian reform

Question 52

Decreeing the emancipation of tenants from the bondage of the soil, transferring to them the ownership of the land they till and providing the instruments and mechanism therefore

Answer 52

Presidential decree no. 27

Question 53

This shall apply to tenant farmers of private agricultural lands primarily devoted to rice and corn under a system or sharecrop or lease tenancy

Answer 53

Presidential decree no. 27

Question 54

An act instituting a comprehensive agrarian reform program to promote social justice and industrialization, providing the mechanism for its implementation, and for other purposes

Answer 54

Republic act no. 6657

Question 55

Is founded on the right of farmers and regular farm workers, who are landless, to own directly or collectively the lands they till or, in the case of other farm workers, to receive a just share of the fruits thereof.

Answer 55

Agrarian reform

Question 56

The redistribution of lands, regardless of crops or fruits produced to farmers and regular farm workers who are landless

Answer 56

Agrarian reforms

Question 57

The cultivation of the soil, plating of crops, growing of fruit trees, rosining of livestock, poultry or fish, including the harvesting of such farm products, and other farm activities and practices performed by a farmer

Answer 57

Agriculture, agricultural enterprise, agricultural activity

Question 58

Refers to land devoted to agricultural activity as defined in this act and not classified as mineral, forest, residential, commercial, or industrial land

Answer 58

Agricultural land

Question 59

Refers to a natural person whose primary livelihood is cultivation of land

Answer 59

Farmer

Question 60

Refers to any agricultural land not cultivated, tilled or developed to produce any crop nor devoted to any specific economic purpose continuously for a period of three years

Answer 60

Idle abandoned land

Question 61

A natural person who renders services for value as an employee or laborer in an agricultural enterprise or farm

Answer 61

Farm workers

Question 62

Is a natural person who is employed on a permanent basis by an agricultural enterprise or farm

Answer 62

Regular farm worker

Question 63

Is a natural person who is employed on a recurrent, periodic, or intermittent basis by an agricultural entreprise or farm

Answer 63

Seasonal farm worker

Question 64

Shall refer to organizations composed primarily of small agricultural producers, farmers, farm workers, or other agrarian producers

Answer 64

Cooperatives