General Principles of Taxation

Question 1

Taxation

Answer 1

is the inherent power by which the sovereign, through its law-making body, raises revenue to defray the necessary expenses of the government

Question 2

Inherent to the state

Answer 2

It is inherent because its exercise is guaranteed by the mere existence of the state.

Question 3

Taxation could be exercised even in the absence of a _______________

Answer 3

Constitutional grant

Question 4

Scope of Legislative power to tax

Answer 4

1. Purposes
2. Subjects
3. Amount or rate
4. Kind
5. Agencies
6. Administrative and judicial remedies
7. Tax exemptions and condonations

Question 5

Theories and Basis of Taxation

Answer 5

1. Lifeblood theory
2. Necessity theory
3. Symbiotic relationship theory

Question 6

Life blood theory

Answer 6

taxes are the lifeblood of the government and so should be collected without unnecessary hindrance

Question 7

Necessity theory

Answer 7

government is necessary; however, it cannot continue without the means of paying for its existence; hence, it has the right to compel all citizens and property within its power to contribute for the same purpose.

Question 8

Symbiotic relationship theory

Answer 8

it is said that taxes are what we pay for a civilized society. Without taxes, the government would be paralyzed for lack of the motive power to activate and operate it.

Question 9

Primary purpose of taxation

Answer 9

to raise revenues;

to support the existence of the State and enable the state to promote the general welfare

Question 10

Secondary purpose of taxation

Answer 10

Non-revenue or sumptuary

Question 11

Non-revenue or sumptuary purposes

Answer 11

1. Promotion of general welfare
2. Regulation
3. Reduction of social inequity
4. Encouragement of economic growth
5. Protectionism

Question 12

Characteristics of the power to tax

Answer 12

1. Comprehensive
2. Unlimited
3. Plenary
4. Supreme

Question 13

Principles of a sound tax system

Answer 13

1. Fiscal Adequacy
2. Administrative Feasibility
3. Theoretical Justice

Question 14

Fiscal Adequacy

Answer 14

revenue raised must be sufficient to meet government/public expenditures and other public needs

Question 15

Administrative Feasibility

Answer 15

tax laws must be clear and concise;
capable of effective and efficient enforcement;
convenient as to time and manner of payment, must not obstruct business growth and economic development

Question 16

Theoretical Justice

Answer 16

must take into consideration the taxpayer’s ability to pay

Question 17

Non-observance of __________ will render the tax measure unsound but not unconstitutional.

Answer 17

Fiscal adequacy and Administrative feasibility

Question 18

Non-observance of ________ may render the tax measure unconstitutional because the constitution itself requires that taxation must be equitable

Answer 18

Theoretical justice

Question 19

Marshall doctrine

Answer 19

the power to tax includes the power to destroy

Question 20

Holmes doctrine

Answer 20

the power to tax is not the power to destroy as long as this court sits

Question 21

Imprescriptibility of taxes

Answer 21

Taxes are generally imprescriptible, except when the law provides otherwise