Situs of Taxation and Double Taxation

Question 1

Situs of Taxation

Answer 1

depends on the possible protection and benefit that may accrue both to the government and the taxpayer, the residence, or the citizenship of the taxpayer and the source of income
Situs of Taxation

Question 2

Persons (Subject Matter)

Answer 2

Poll tax may properly be levied upon persons who are inhabitants or residents of the state, whether citizens or not.

Question 3

Real Property (Subject Matter)

Answer 3

With respect to property taxes, real estate is subject to taxation in the state in which it is location whether the owner is a resident or non-resident and is taxable only there

Question 4

Tangible personal property (Subject Matter)

Answer 4

the modern rule is that it is taxable in the state where it has actual situs — where it is physically located—although the owner resides in another jurisdiction.

Question 5

Lex Rei Sitae

Answer 5

“Real property as well as personal property is subject to the law of the country where it is situated”

the law of the situated property

Question 6

Intangible personal property (Subject Matter)

Answer 6

Intangible personalty such as credits, bills receivables, bank deposits, bonds, promissory notes, mortgage loans, judgements and corporate stocks do not admit of actual location

Question 7

(Intangible personal property) the situs for purposes of property taxation is at the ______________

Answer 7

domicile of the owner

Question 8

mobilia sequuntur personam

Answer 8

“movables follow the person”

the situs of personal property is the domicile of the owner

Question 9

(Intangible personal property) shares of stock in a domestic corporation of a non-resident foreigner are ________________

Answer 9

taxable in the Philippines

Question 10

Why are shares of stock in a domestic corporation of a non-resident foreigner taxable in the Philippines?

Answer 10

Because the shares receive the protection and benefit of our laws

Question 11

Income (Subject Matter)

Answer 11

exacted from persons who are residents or citizens in the taxing jurisdiction and even from those who are neither residents nor citizens provided the income is derived from sources within the taxing state

Question 12

the power to levy an excise tax depends upon ___________________

Answer 12

the place where the business is done, or the occupation is engaged in, or the transaction took place.

Question 13

excise tax

Answer 13

is a special tax imposed on the manufacture, sale or use of specific goods or services rather than on income or general retail sales.

Question 14

Gratuitous transfer of property (Subject Matter)

Answer 14

transmission of property from donor to a donee or from a decent to his heir may be subject to taxation in the state where the transferor is (was) a citizen or resident, or where the property is located

Question 15

Multiplicity of situs
Effect

Answer 15

the variance in the concept of “domicile”

relationships that may arise with respect to intangible personal property (debtor, creditor, trustee, etc.)

the use to which the property may have been devoted which may receive the protection of the laws of jurisdiction

Question 16

Multiplicity of situs
Remedy (to avoid/reduce this)

Answer 16

provide for exemptions or allowance of deduction or tax credit for foreign taxes

enter into treaties with other states

Question 17

Direct duplication taxation or direct double taxation

Answer 17

taxing twice by the same taxing authority within the same jurisdiction or taxing district or locality for the same purpose, in the same year (or taxing period) some of the property in the territory

Question 18

Indirect duplicate taxation or indirect double taxation

Answer 18

taxation other than direct duplicate. It extends to all cases in which there is a burden of two or more pecuniary impositions

Question 19

Constitutionality of double taxation
the general rule

Answer 19

the constitution does not prohibit double taxation; hence it may not be invoked as a defense against the validity of a tax law

Question 20

Constitutionality of double taxation
Exception

Answer 20

doubts as to whether double taxation has been imposed should be resolved in favor of the taxpayer to avoid injustice or unfairness

double taxation while not forbidden is something not favored. it must be avoided and prevented whenever possible