Principles of Taxation Flashcards
Out of the 3 powers of state, which can be exercised by private entities?
ONLY eminent domain
Out of the 3 powers of state, which is inferior to the non impairment clause?
ONLY taxation
Similarities of the 3 (LII)
- legislative in nature (congress only)
- inherent
- independent of constitution
2 Process of Taxation
- Levying / Imposition - Impact of Taxation
- Assessment / Collection - Incidence of taxation
Impact of taxation is exercised by what branch of government?
Incidence of taxation is exercised by what branch of government?
Legislative
Executive
Scope of Taxation
CUPS
Comprehensive
Unlimited
Plenary
Supreme
Theory of Taxation
a necessity (lifeblood doctrine)
Basis of Taxation
reciprocal duties (benefits-received)
Basic Principles of a Sound Tax System
FAT
Fiscal Adequacy
Administrative Feasibility
Theoretical Justice
Inherent Limitation
TIP-END
Territoriality
International Comity
Public Purpose
Exemption of Government
Non Delegation of power of taxation
In case of conflict between domestic law and treaty, who will prevail?
treaty
GOCC is part of government. They are exempt. True or False?
False (GOCC is taxable)
In case of deficiency
- prescription period for assessment
3 years from filing OR deadline of return (whichever is later)
In case of deficiency
- prescription period for collection
5 years from date of assessment
In case of delinquency
- prescription period for non filing or fraud
10 years from discovery
X will not be imprisoned if he did not pay for debt tax. True or False?
True (constitutional limitation)
Correct Hierarchy in Tax Cases
- CTA, SC, BIR
BIR → CTA → SC
To be exempt from PROPERTY tax, what is the rule for religious, educational, charitable?
Doctrine of Use
ADE (actually, directly, exclusively)
To pass a tax exemption law, what must be the number of votes in congress?
Half + 1 (majority)
Appropriation of Tariff Bills come from senate. True or False?
False (come from HoR, but senate may propose amendments)
What is the primary element for double taxation?
Same subject
Examples of National Taxes
BITES-C
- Business Tax
- Income Tax
- Transfer Tax
- Excise Tax
- Stamp Tax
- Custom Duties
Specific vs Ad Valorem
Specific - per unit basis
Ad Valorem - based on value
Tax vs Toll
- Tax is demand of ownership. True or False?
False (demand of sovereignty)
Tax vs Special Assessment
- Tax is a personal liability. True or False?
True
- Special Assessment → land yung liable na magbayad (since for land lang naman yung special assessment)
Tax vs License
- Non payment of tax makes a business illegal. True or False?
False (sa license yon, since hindi dapat mag-operate ang business habang di pa nababayaran yung license)
Tax vs Debt
- Liability to pay tax is not assignable. True or False?
True (Debt → assignable)
Tax vs Debt
- Tax may be paid in kind and may be subject to set-off. True or False?
False (payable in money, and not subject to set-off)
Forms of Escape From Taxation
no loss to government
Shifting
Capitalization - lower price, buyer will shoulder tax
Transformation - increase quantity of production
Forms of Escape From Taxation
with loss to government
Exemption
Evasion (Dodging)
Avoidance (Minimization)
Power to Destroy. What doctrine is this?
Marshall Doctrine
Power to Build. What doctrine is this?
Holmes Doctrine
Fundamental Doctrines in Taxation
- Judicial Non Interference
yes
Fundamental Doctrines in Taxation
- Government’s right to collect tax prescribe. True or False?
False (impresciptibility)
Fundamental Doctrines in Taxation
- Tax is prospective in nature. True or False?
True
Fundamental Doctrines in Taxation
- Tax is civil in nature (not penal). True or False?
True
In case of conflict between tax law and GAAP, who will prevail?
tax law
Tax law is strictly against government and liberally in favor of taxpayer. Explain (also explain tax exemption)
yes
Revenue Regulation
- to specify, define, prescribe rules. True or False?
- has no effect of law. True or False?
True
False (RR has force and effect of law)
BIR Rulings
- internal instructions for officer of BIR. True or False?
- binding and applicable to addressee only. True or False?
False (definition of RMC)
BIR Rulings → Q&A
True
4 Deputy Commissioner of BIR
RILO
Resource Management
Information Systems
Legal Enforcement
Operations
Powers of CIR that Cannot be Delegated
RICA
- Recomment promulgation of rules and regulations to secretary of DOF
- Issue rulings of first impression or to reverse or modify existing rulings of BIR
- Compromise or abate tax liability (XPN - basic deficiency tax of 500K or less)
- Assign and reassign internal revenue officers to establishment where articles subject to excise tax are produced or kept
Tax Amnesty vs Tax Condonation
Tax Amnesty
- intentional overlooking of state
- to give a chance to reform and have a clean slate
- no tax liability at all
- need not pay anything
- can be availed by any qualified taxpayer
Tax Amnesty vs Tax Condonation
Tax Condonation
- no refund for taxes already paid
- condonation from payment of existing tax liability
- pays a portion
- not always available
