Chapter 1

Question 1

IS THE PROCESS OR MEANS BY WHICH THE SOVEREIGN, THROUGH ITS LAWMAKING BODY, RAISES INCOME TO DEFRAY THE NECESSARY EXPENSES OF THE GOVERNMENT

Answer 1

Taxation

Question 2

THE THEORY THAT THE EXISTENCE OF GOVERNMENT IS A NECESSITY.

Answer 2

NECESSITY THEORY

Question 3

THE THEORY THAT STATES THAT THERE ARE RECIPROCAL DUTIES OF PROTECTION AND SUPPORT BETWEEN THE STATE AND ITS INHABITANTS.

Answer 3

BENEFIT-RECEIVED THEORY

Question 4

TAX MONEY COLLECTED FOR SPECIAL PURPOSE MUST BE APPLIED ONLY FOR THAT PURPOSE

Answer 4

NON-DIVERSION

Question 5

TAX OF A FIXED AMOUNT IMPOSED ON INDIVIDUALS RESIDING WITHIN A SPECIFIED TERRITORY WITHOUT REGARD TO THEIR PROPERTY OR THE OCCUPATION IN WHICH THEY MAY BE ENGAGED

Answer 5

PERSONAL, POLL OR CAPITATION TAX

EXAMPLE: COMMUNITY TAX (FORMERLY RESIDENCE TAX) OR CEDULA.

Question 6

TAX IMPOSED ON PROPERTY, WHETHER REAL OR PERSONAL, IN PROPORTION EITHER TO ITS VALUE OR WITH SOME OTHER REASONABLE METHOD OF APPORTIONMENT.

Answer 6

PROPERTY TAX

EXAMPLE: REAL ESTATE TAX

Question 7

TAX IMPOSED UPON THE PERFORMANCE OF AN ACT, THE ENJOYMENT OF PRIVILEGE OR THE ENGAGING IN OCCUPATION.

Answer 7

EXCISE OR PRIVILEGE TAX

EXAMPLES: INCOME TAX, VALUE -ADDED TAX , PERCENTAGE TAX

Question 8

TAX WHICH IS DEMANDED FROM THE PERSON WHO IS INTENDED TO PAY IT.

Answer 8

DIRECT TAX

EXAMPLES: COMMUNITY TAX, INCOME TAX

Question 9

TAX WHICH THE TAXPAYER CAN SHIFT TO ANOTHER

Answer 9

INDIRECT TAX

EXAMPLES: BUSINESS TAXES, CUSTOMS DUTIES

Question 10

TAX OF A FIXED AMOUNT IMPOSED BY HEAD OR NUMBER, OR BY SOME STANDARD OF WEIGHT OR MEASUREMENT.

Answer 10

SPECIFIC TAX

EXAMPLES: EXCISE TAXES ON DISTILLED SPIRITS, CIGARS, CIGARETTES

Question 11

TAX OF A FIXED PROPORTION OF THE AMOUNT OR VALUE OF PROPERTY WITH RESPECT TO WHICH THE TAX IS ASSESSED.

Answer 11

AD VALOREM TAX

EXAMPLES: REAL ESTATE TAX, CUSTOMS DUTIES, INCOME TAX

Question 12

TAX IMPOSED TO RAISE REVENUE FOR THE GOVERNMENT.

Answer 12

GENERAL, FISCAL OR REVENUE TAX

EXAMPLES: INCOME TAX, BUSINESS TAXES

Question 13

TAX TO ACHIEVE SOME SOCIAL OR ECONOMIC ENDS IRRESPECTIVE OF WHETHER REVENUE IS ACTUALLY RAISED OR NOT.

Answer 13

SPECIAL OR REGULATORY TAX

EXAMPLES: PROTECTIVE TARIFFS ON IMPORTED GOODS

Question 14

TAX IMPOSED BY NATIONAL GOVERNMENT.

Answer 14

NATIONAL TAX

EXAMPLES: NIRC-COVERED TAXES(INCOME TAX, DONOR’S TAX, VAT, ETC.)

Question 15

TAX IMPOSED BY MUNICIPAL CORPORATIONS OR LOCAL GOVERNMENTS.

Answer 15

MUNICIPAL OR LOCAL TAX

EXAMPLES: TAX ON OCCUPATIONS, FLOOD TAX

Question 16

TAX BASED ON A FIXED PERCENTAGE OF THE AMOUNT OF PROPERTY, INCOME OR OTHER BASIS TO BE TAXED.

Answer 16

PROPORTIONAL

EXAMPLES: REAL ESTATE TAX, VAT.

Question 17

TAX THE RATE OF WHICH INCREASES AS THE TAX BASE INCREASES.

Answer 17

PROGRESSIVE OR GRADUATED TAX

EXAMPLES: INCOME TAX, ESTATE TAX, DONOR’S TAX

Question 18

TAX THE RATE OF WHICH DECREASES AS TAX BASE INCREASES

Answer 18

REGRESSIVE TAX

Question 19

A TAX ON ALL YEARLY PROFITS ARISING FROM PROPERTY, PROFESSIONS, TRADES OR OFFICES OR A TAX ON A PERSON’S INCOME, EMOLUMENTS, PROFITS AND THE LIKE.

Answer 19

INCOME TAX

Question 20

PLACE OF TAXATION OR THE STATE OR POLITICAL UNIT W/C HAS JURISDICTION TO IMPOSE TAX OVER ITS INHABITANTS

Answer 20

SITUS OF TAXATION

Question 21

THE POWER TO PROTECT CITIZENS AND PROVIDE FOR SAFETY AND WELFARE OF SOCIETY

Answer 21

POLICE POWER

Question 22

THE POWER TO TAKE PRIVATE PROPERTY (WITH JUST COMPENSATION) FOR PUBLIC USE

Answer 22

EMINENT DOMAIN POWER

Question 23

COURTEOUS RECOGNITION, FRIENDLY AGREEMENT, INTERACTION AND RESPECT ACCORDED BY ONE NATION TO THE LAWS AND INSTITUTIONS OF ANOTHER

Answer 23

INTERNATIONAL COMITY

Question 24

NATURAL RESTRICTIONS TO SAFEGUARD AND ENSURE THAT THE POWER OF TAXATION SHALL BE EXERCISED BY THE GOVERNMENT ONLY FOR THE BETTERMENT OF THE PEOPLE WHOSE INTEREST S/B SERVED, ENHANCED AND PROTECTED

Answer 24

INHERENT LIMITATIONS

Question 25

PROVISIONS OF THE CONSTITUTION THAT RESTRICT THE SUPREME, PLENARY, UNLIMITED AND COMPREHENSIVE EXERCISE BY THE STATE OF ITS INHERENT POWER TO TAX

Answer 25

CONSTITUTIONAL LIMITATIONS

Question 26

ALL PERSONS SUBJECT TO LEGISLATION SHALL BE TRETED ALIKE UNDER SIMILAR CIRCUMSTANCES AND CONDITIONS BOTH IN THE PRIVILEGES CONFEREED AND LIABILITIES IMPOSED

Answer 26

EQUAL PROTECTION OF LAW

Question 27

TAX OPERATES WITH THE SAME FORCE AND EFFECT IN EVERY PLACE WHERE THE SUBJECT MAY BE FOUND

Answer 27

UNIFORMITY RULE OF TAXATION

Question 28

THE POWER TO VETO ITEMS IN APPROPRIATION BILLS WITHOUT AFFECTING OTHER PROVISIONS OF SUCH BILLS

Answer 28

ITEM VETO

Question 29

THE POWER TO DISAPPROVE LEGISLATIVE ACT BY THE PRESIDENT WITH THE RESULT THAT BILLS SHALL FAIL TO BECOME LAWS

Answer 29

POCKET VETO

Question 30

SPECIAL DUTY WHOSE PURPOSE IS TO OFFSET ANY FOREIGN DISCRIMINATION AGAINST OUT LOCAL COMMERCE

Answer 30

DISCRIMINATORY DUTY

Question 31

IMPOSED TO OFFSET ANY FOREIGN SUBSIDY GRANTED TO IMPORTED GOODS TO THE PREJUDICE OF OUR LOCAL INDUSTRIES

Answer 31

COUNTERVAILING DUTY

Question 32

ADDITIONAL DUTY TAX GENERALLY IMPOSED ON IMPORTED ARTICLES AND/OR CONTAINERS WITH IMPPROPER CLASSIFICATION

Answer 32

MARKING DUTY

Question 33

ADDITIONAL DUTY TAXES IMPOSED ON IMPORTED GOODS WITH PRICES LESSER THAN THEIR FMV TO PROTECT LOCAL INDUSTRIES

Answer 33

DUMPING DUTY

Question 34

A TAX BILL MUST ONLY BE APPLICABLE AND OPERATIVE AFTER BECOMING A LAW

Answer 34

PROSPECTIBILITY OF TAX LAWS

Question 35

UNLESS OTHERWISE PROVIDED BY THE TAX LAW ITSELF, TAXES IN GENERAL ARE NOT CANCELLABLE

Answer 35

TAX IMPRESCRIPTIBILITY

Question 36

ACT OF THE SOVEREIGN BY TAXING TWICE FOR THE SAME PURPOSE IN THE SAME YEAR UPON THE SAME PROPERTY OR ACTIVITY OF THE SAME PERSON

Answer 36

DOUBLE TAXATION

Question 37

UNLAWFUL MEANS TO LESSEN THE PAYMENT OF TAX

Answer 37

TAX EVASION

Question 38

REDUCING OR TOTALLY ESCAPING PAYMENT OF TAXES THROUGH LEGALLY PERMISSIBLE MEANS

Answer 38

TAX AVOIDANCE/TAX MINIMIZATION

Question 39

CHOICE TO PAY LOWER TAX RATES IN SOME TRANSACTIONS AS PERMITTED BY TAX LAWS

Answer 39

TAX OPTION

Question 40

TRANSFER OF TAX BURDEN TO ANOTHER

Answer 40

SHIFTING

Question 41

THE PRODUCER ABSORBS THE PAYMENT OF TAX TO REDUCE PRICES AND TO MAINTAIN MARKET SHARE

Answer 41

TRANSFORMATION

Question 42

GRANT OF IMMUNITY, EXPRESSED OR IMPLIED, TO A PARTICULAR PERSON, CORPORATION, OR TO PERSONS OR CORPORATIONS OF A PARTICULAR CLASS, FROM A TAX UPON PROPERTY OR AN EXCISE W/C PERSONS AND CORPORATIONS GENERALLY W/IN THE SAME TAXING DISTRICT ARE OBLIGED TO PAY

Answer 42

EXEMPTION FROM TAXATION

Question 43

EXEMPTIONS THAT ARE STATUTORY LAWS IN NATURE AS PROVIDED BY CONSTITUTION, STATUTE, TREATIES, ORDINANCES, FRANCHISES OR SIMILAR LEGISLATIVE ACTS

Answer 43

EXPRESSED EXEMPTION

Question 44

WHEN TAX IS IMPOSED ON A CERTAIN CLASS OF PERSONS, PROPERTIES OR TRANSACTIONS W/O MENTIONING OTHER CLASSES, THOSE NOT MENTIONED ARE DEEMED EXEMPTED

Answer 44

IMPLIED EXEMPTION OR BY OMISSION

Question 45

THOSE LAWFULLY ENTERED INTO BY THE GOV’T IN CONTRACTS UNDER EXISTING LAWS

Answer 45

CONTRACTUAL EXEMPTION

Question 46

A LAW DOCTRINE W/C STATES THAT A TAX CLAIM FOR REFUND, W/C IS PREVENTED BY PRESCRIPTION, MAY BE ALLOWED AS PAYMENT FOR UNSETTLED TAX LIABILITIES IF BOTH TAXES ARISE FROM THE SAME TRANSACTION IN W/C OVERPAYMENT IS MADE AND UNDERPAYMENT IS DUE

Answer 46

EQUITABLE RECOUPMENT

Question 47

TAXES ARE NOT SUBJECT TO SET-OFF OR LEGAL COMPENSATION BECAUSE THE GOV’T AND THE TAXPAYER ARE NOT MUTUAL CREDITOR AND DEBTOR OF EACH OTHER

Answer 47

DOCTRINE OF SET-OFF TAXES

Question 48

ANY SANCTION IMPOSED, AS A PUNISHMENT FOR VIOLATIONS OF LAW OR ACTS DEEMED INJURIOUS

Answer 48

PENALTY

Question 49

ALL FUNDS OR INCOME DERIVED BY THE GOV’T

Answer 49

REVENUE

Question 50

AN OBLIGATION TO PAY OR RENDER SERVICE FOR A DEFINITE FUTURE PERIOD OF TIME BASED ON CONTRACT

Answer 50

DEBT

Question 51

COMPENSATION FOR USE OF SOMEBODY ELSE’S PROPERTY DETERMINED BY THE COST OF THE IMPROVEMENT

Answer 51

TOLL

Question 52

CONTRIBUTION BY THE GOV’T PRIMARILY TO RESTRAIN AND REGULATE BUSINESS OR OCCUPATION

Answer 52

LICENSE FEE

Question 53

IMPOSITION ON IMPORTED GOODS TO PROTECT LOCAL INDUSTRY

Answer 53

CUSTOMS DUTIES

Question 54

SCHEDULE OR LIST OF RATES, DUTIES OR TAXES IMPOSED ON IMPORTED GOODS

Answer 54

TARIFF

Question 55

MONETARY AID DIRECTLY GRANTED OR GIVEN BY THE GOV’T TO AN INDIVIDUAL OR PRIVATE COMMERCIAL ENTERPRISES DEEMED BENEFICIAL TO THE PUBLIC

Answer 55

SUBSIDY

Question 56

TAX ON FOREIGN EXCHANGE DESIGNED TO CURB THE EXCESSIVE DEMANDS ON OUR INT’L RESERVES

Answer 56

MARGIN FEE

Question 57

AN AMOUNT COLLECTED BY THE GOV’T FOR THE PURPOSE OF REIMBURSING ITSELF FOR CERTAIN EXTENDED BENEFITS REGARDING CONSTRUCTION OF PUBLIC WORKS

Answer 57

SPECIAL ASSESSMENT

Question 58

BODY OF LAWS W/C CODIFIES ALL NATIONAL TAX LAWS INCLUDING INCOME, ESTATE, GIFT, EXCISE, STAMP AND OTHER TAXES

Answer 58

TAX LAW

Question 59

INCLUDES ALL LAWS LEGISLATED PERTAINING TO THE NAT’L GOV’T TAXES, W/C IS EMBODIED IN THE NIRC

Answer 59

INTERNAL REVENUE LAW

Question 60

TAXES IMPOSED BY THE LEGISLATIVE BODY OTHER THAN CUSTOMS DUTIES ON IMPORTS

Answer 60

INTERNAL REVENUE TAXES

Question 61

TAX LAWS S/B INTERPRETED W/ REFERENCE TO OTHER TAX LEGISLATIONS AND THEIR EFFECT AS A WHOLE MAY BE GIVEN CONSIDERATION

Answer 61

PRINCIPLE OF “PARI MATERIA”

Question 62

LAWS ENACTED AND ESTABLISHED BY THE WILL OF THE LEGISLATIVE DEPT. OF THE GOV’T

Answer 62

STATUTES

Question 63

REGULATIONS ISSUED BY THE PRESIDENT OR SOME ADMINISTRATIVE AUTHORITY UNDER HIS DIRECTION FOR THE PURPOSE OF INTERPRETING, IMPLEMENTING, OR GIVING ADMINISTRATIVE EFFECT TO A PROVISION OF THE CONSTITUTION OR SOME LAW OR TREATY

Answer 63

EXECUTIVE ORDERS

Question 64

INTERNATIONAL AGREEMENTS W/ FOREIGN COUNTRIES REGARDING TAX ENFORCEMENT AND EXEMPTIONS

Answer 64

TAX TREATIES AND CONVENTIONS

Question 65

RULES OR ORDERS HAVING FORCE OF LAW ISSUED BY EXECUTIVE AUTHORITY OF THE GOV’T TO ENSURE UNIFORM APPLICATION OF THE TAX LAW

Answer 65

REVENUE REGULATIONS

Question 66

ADMINISTRATIVE RULINGS AND OPINIONS W/C ARE LESS GENERAL INTERPRETATIONS OF TAX LAWS BEING ISSUED FROM TIME TO TIME BY BIR COMMISSIONER OR BOC COMMISSIONER

Answer 66

REVENUE MEMORANDUM CIRCULARS

Question 67

EXPRESSED OFFICIAL INTERPRETATION OF THE TAX LAWS AS APPLIED TO SPECIFIC TRANSACTIONS

Answer 67

BIR RULINGS

Question 68

DECISIONS FOR APPLICATION MADE CONCERNING TAX ISSUES BY THE PROPER COURTS EXERCISING JUDICIAL AUTHORITY OF COMPETENT JURISDICTION

Answer 68

JUDICIAL DECISIONS

Question 69

TAX ORDINANCES ISSUED BY THE PROVINCE, CITY, MUNICIPALITY AND BARANGAY SUBJECT TO SUCH LIMITATIONS AS PROVIDED BY THE LG CODE AND REAL PROPERTY TAX CODE

Answer 69

LOCAL TAX ORDINANCES