Taxation Part 2 Flashcards
What are the 6 classifications of Taxes?
- As to Subject Matter
- As to Amount
- As to Rate
- As to Incidence
- As to Imposing Authority
- As to Purpose
What are the 4 types of taxes As to Subject Matter?
- Poll or Capitation
- Personal
- Privilege or Excise
- Property
What are the 2 types of taxes As to Amount?
- Specific - Based on a unit of measurement
- Ad Valorem - Based on value of property
What are the 3 types of taxes As to Rate?
1.Proportional
2. Regressive
3. Progressive
What are the 2 types of taxes As to Incidence?
- Direct - You cannot shift this tax burden
- Indirect - You can the tax burden around
What are the 2 types of taxes As to Imposing Authority
1.National Tax
2. Local Tax
What are the 3 types of taxes As to Purpose
- Fiscal or Revenue
- Regulatory
- Sumptuary or Compensatory
Differentiate Tax and Debt
Both are obligations but
Tax comes from Law (Can go to Jail)
Debt comes from Contracts (Can not go to Jail)
You can set off debts but not Tax
You can pay off debts with property but tax is money almost exclusively
What is Dacion en Pago
In dacion en pago, property is alienated to the creditor in satisfaction of a debt in money.
Basically you pay off your debt with property instead of money
In practice this is when the creditor takes your car if you can’t pay your debt
Differentiate Tax and Toll
Tax is a levy of government, is a demand of sovereignty
Toll is a charge for use of other property, is a demand of ownership
Differentiate Tax and Special Assessment
Tax is broadly imposed on a lot of things
Special Assessment is only imposed on land (and provided it is for public benefit)
Tax can be levied without expectation of direct proximate benefit
These are the laws that grant immunity from taxation
Tax Exemption
Differentiate Tax and Tariff
Tax is broader
Tariffs are only imposed on imports and exports
Give some sources of Tax laws
Philippine Constitution
Statutes and Presidential Decrees
Judicial Decisions
Executive Orders and Batas Pambansa
Administrative Issuances
Tax Treaties
(The top overrides the statements from the others)
Differentiate Tax and Licenses
Tax comes from the taxation power
Licenses come from the Police Power
If a business doesn’t pay its taxes, it has committed an illegal act.
If a business doesn’t pay its license, then the business itself becomes illegal, because its existence no longer becomes recognized as a lawful entity.
These are the laws that provide for the assessment and collection of taxes
Tax Laws
This type of administrative issuance is signed by the secretary of finance, upon recommendation of the commissioner of internal revenue.
Specifies the guidelines or defines rules and regulations for the effective enforcements of provisions of the national internal revenue code
Revenue Regulations
This type of administrative issuance provides directives or instructions; prescribe guidelines; and outline processes, operations, and activities, workflows, methods and procedures necessary in the implementation of stated policies, goals, objectives, plans, and programs of the BIR in all areas of operations.
Revenue Memorandum Orders
Rulings, Opinions of the CIR
Revenue Memorandum Rulings
This type of administrative issuance publishes pertinent and applicable portions as well as amplifications of laws rules, regulations and precedents issued by the BIR and other agencies and offices.
Revenue Memorandum Circular
What are the rules in Constructing Tax Imposing Laws?
- Public Purpose is Presumed
- Spirit of the law is considered (Analyze the true legislative intention)
- A statute will not be construed as imposing a tax unless it does so clearly, expressly and unambiguously
- In case of doubt, it is construed most strongly against the government, and liberally in favor of the taxpayer
- Tax laws operate prospectively unless the retrospective effect is expressly declared
