[Excercise 1-4] Multiple Choice Flashcards
In every case of doubt, tax statutes should be construed liberally in favor of the taxpayer and strictly against the government.
a. Transformation
b. Interpretation of tax laws
c. Double taxation
d. Tax exemption
ANSWER: b. Interpretation of tax laws
The following, except one, are basic principles of a sound tax system:
a. It should be capable of being effectively enforced.
b. It must be progressive.
c. Sources of revenue must be sufficient to meet government expenditures and other public needs.
d. It should be exercised to promote public welfare.
d. It should be exercised to promote public welfare.
The following are constitutional limitations on the power of taxation, EXCEPT one:
a. Public purpose
b. No imprisonment for non-payment of tax
c. Equal protection of law
d. Power of the President to veto items in a revenue bill
ANSWER: d. Power of the President to veto items in a revenue bill
Which of the following is subject to tax?
a. A building being used actually, directly, and exclusively for educational purposes
b. The Roman Catholic Church
c. Privately owned cemeteries
d. Income from a sermon of a parish priest
ANSWER: d. Income from a sermon of a parish priest
The defense available to a taxpayer who is required to pay a tax that is retroactive in application:
a. That the tax is levied for religious purposes
b. Due process of law
c. Equal protection of the law
d. Non-impairment of obligations of contract
ANSWER: b. Due process of law
Which of the following statements is NOT correct with respect to tax exemption?
a. Tax exemptions are liberally construed in favor of the grantee and strictly against the government.
b. When tax exemptions are claimed, they must be shown to exist, for every presumption is against it, and a well-founded doubt is fatal to the claim.
c. Tax exemptions are looked upon with disfavor against the grantee and generally in favor of the taxing authority.
d. The State cannot strip itself of the most essential power of taxation by doubtful words. It cannot be deprived of this highest attribute of sovereignty.
ANSWER: a. Tax exemptions are liberally construed in favor of the grantee and strictly against the government.
Without revenue raised from taxation, the government will not survive, causing detriment to society.
a. Lifeblood theory
b. Basis of taxation
c. Tax evasion
d. Symbiotic relationship
ANSWER: a. Lifeblood theory
A taxpayer gives the following reasons in refusing to pay a tax. Which of these reasons is NOT acceptable for legally refusing to pay the tax?
a. That he has been deprived of due process
b. That there is a lack of territorial jurisdiction
c. That the prescriptive period for the tax has elapsed
d. That he will derive no benefit from the tax
ANSWER: d. That he will derive no benefit from the tax
A canon of taxation that means tax laws must be clear and concise, capable of proper enforcement, and not burdensome, ensuring convenience as to time and manner of payment:
a. Fiscal adequacy
b. Administrative feasibility
c. Ability-to-pay principle
d. Theoretical justice
ANSWER: b. Administrative feasibility
One of the characteristics of a tax is that:
a. It is generally based on contract.
b. It is generally payable in money.
c. It is generally assignable.
d. Answer not given.
ANSWER: b. It is generally payable in money.
This is a prerogative of escaping or diminishing a tax liability through availment of ways allowed by law or not subject to legal penalties to reduce tax liability:
a. Tax exemption
b. Tax avoidance
c. Tax assessment
d. Tax evasion
ANSWER: b. Tax avoidance
Tariff may generally be defined as:
a. Amounts imposed on goods entering the imposing country.
b. Amounts which are levied on goods leaving the imposing country.
c. Amounts imposed on goods passing through the imposing country but destined ultimately to another country.
d. A list of commodities with corresponding duties collectible.
ANSWER: a. Amounts imposed on goods entering the imposing country.
A rule in taxation that states all taxable persons and property of the same class are taxed at the same rate is:
a. Uniformity in taxation
b. Scope of taxation
c. Theory of taxation
d. Situs of taxation
ANSWER: a. Uniformity in taxation
The country that has the jurisdiction or right to levy and collect the tax is:
a. Scope of taxation
b. Situs of taxation
c. Theory of taxation
d. Equality in taxation
ANSWER: b. Situs of taxation
A tax upon a corporation for its property and upon its shareholders for their shares is an example of:
a. Poll tax
b. Direct duplicate taxation
c. Indirect duplicate taxation
d. Uniformity in taxation
ANSWER: c. Indirect duplicate taxation
One of the characteristics of a tax is:
a. A tax is a pecuniary burden, and the law may not allow payment in kind.
b. It is dependent upon the will or contractual assent, express or implied, of the person taxed.
c. It is levied by the State by virtue of its sovereignty.
d. It is collected for public and private purposes.
ANSWER: c. It is levied by the State by virtue of its sovereignty.
Value-added tax is NOT an example of what kind of tax?
a. Indirect tax
b. Direct tax
c. Proportional tax
d. Business tax
ANSWER: b. Direct tax
The following are similarities of the inherent powers of taxation, eminent domain, and police power, EXCEPT one:
a. Are necessary attributes of sovereignty.
b. Interfere with private rights and property.
c. Affect all persons or the public.
d. Are legislative in their implementation.
ANSWER: c. Affect all persons or the public.
Which statement refers to police power as distinguished from taxation?
a. It can only be imposed on specific property or properties.
b. The amount imposed depends on whether the activity is useful or not.
c. It involves the taking of property by the government.
d. The amount imposed has no limit.
ANSWER: b. The amount imposed depends on whether the activity is useful or not.
The distinction of tax from a permit or license fee is that a tax is:
a. Imposition for regulation.
b. One which involves an exercise of police power.
c. One in which there is generally no limit on the amount that may be imposed.
d. Answer not given.
ANSWER: c. One in which there is generally no limit on the amount that may be imposed.
