Podcast
Questions and Answers
What does the basis of taxation refer to?
What does the basis of taxation refer to?
Which theory presumes that the more benefits one receives from the government, the more taxes they should pay?
Which theory presumes that the more benefits one receives from the government, the more taxes they should pay?
According to the ability to pay theory, how should taxation be structured?
According to the ability to pay theory, how should taxation be structured?
Which statement about taxpayer obligations is correct?
Which statement about taxpayer obligations is correct?
Signup and view all the answers
What principle is illustrated by the phrase 'those who have more should be taxed more'?
What principle is illustrated by the phrase 'those who have more should be taxed more'?
Signup and view all the answers
What does the principle of mutuality in taxation imply?
What does the principle of mutuality in taxation imply?
Signup and view all the answers
In terms of taxation, what is a key consideration in cost allocation?
In terms of taxation, what is a key consideration in cost allocation?
Signup and view all the answers
Which of the following best describes the receipt of benefits from the government in relation to taxation?
Which of the following best describes the receipt of benefits from the government in relation to taxation?
Signup and view all the answers
Which body has the constitutional authority to originate tax bills?
Which body has the constitutional authority to originate tax bills?
Signup and view all the answers
What does 'situs' refer to in the context of taxation?
What does 'situs' refer to in the context of taxation?
Signup and view all the answers
Which of the following correctly describes the situs of a business tax?
Which of the following correctly describes the situs of a business tax?
Signup and view all the answers
Which of the following is NOT a matter of legislative discretion regarding taxation?
Which of the following is NOT a matter of legislative discretion regarding taxation?
Signup and view all the answers
If a foreign corporation leases property to a non-resident in another country, what is the tax implication?
If a foreign corporation leases property to a non-resident in another country, what is the tax implication?
Signup and view all the answers
What stage refers to the administrative act of determining and collecting tax liabilities?
What stage refers to the administrative act of determining and collecting tax liabilities?
Signup and view all the answers
Which of these activities is an example of determining the object of taxation?
Which of these activities is an example of determining the object of taxation?
Signup and view all the answers
When assessing the situs of taxation, which principle applies to the income from services?
When assessing the situs of taxation, which principle applies to the income from services?
Signup and view all the answers
Where is the situs of taxation for the gain on sale of goods when the sale is consummated in a different country?
Where is the situs of taxation for the gain on sale of goods when the sale is consummated in a different country?
Signup and view all the answers
What is the tax implication for an overseas Filipino worker who owns a residential lot in the Philippines?
What is the tax implication for an overseas Filipino worker who owns a residential lot in the Philippines?
Signup and view all the answers
What determines the personal tax situs for a non-resident alien studying in a country?
What determines the personal tax situs for a non-resident alien studying in a country?
Signup and view all the answers
Which doctrine states that taxation power can be used as an instrument of police power?
Which doctrine states that taxation power can be used as an instrument of police power?
Signup and view all the answers
In what way does Holme's Doctrine differ from Marshall's Doctrine?
In what way does Holme's Doctrine differ from Marshall's Doctrine?
Signup and view all the answers
If a non-resident OFW sells his property while abroad, where would the gain be taxed?
If a non-resident OFW sells his property while abroad, where would the gain be taxed?
Signup and view all the answers
Which of the following is true regarding the taxation of non-residents?
Which of the following is true regarding the taxation of non-residents?
Signup and view all the answers
What is one potential outcome of the Marshall Doctrine in practice?
What is one potential outcome of the Marshall Doctrine in practice?
Signup and view all the answers
What is a potential manifestation of the Marshall Doctrine in taxation?
What is a potential manifestation of the Marshall Doctrine in taxation?
Signup and view all the answers
Which of the following is an application of Holme's Doctrine?
Which of the following is an application of Holme's Doctrine?
Signup and view all the answers
Under what condition can income tax laws operate retrospectively?
Under what condition can income tax laws operate retrospectively?
Signup and view all the answers
What does the principle of non-compensation in taxation imply?
What does the principle of non-compensation in taxation imply?
Signup and view all the answers
When can a taxpayer's claim for a tax refund be considered for set-off?
When can a taxpayer's claim for a tax refund be considered for set-off?
Signup and view all the answers
What is the implication of non-assignment of taxes?
What is the implication of non-assignment of taxes?
Signup and view all the answers
What does the concept of imprescriptibility in taxation signify?
What does the concept of imprescriptibility in taxation signify?
Signup and view all the answers
According to the NIRC, when does tax prescription occur?
According to the NIRC, when does tax prescription occur?
Signup and view all the answers
What is the primary goal of tax avoidance?
What is the primary goal of tax avoidance?
Signup and view all the answers
Which of the following accurately describes tax exemption?
Which of the following accurately describes tax exemption?
Signup and view all the answers
What does backward shifting in tax refer to?
What does backward shifting in tax refer to?
Signup and view all the answers
How does capitalization relate to tax changes?
How does capitalization relate to tax changes?
Signup and view all the answers
What does tax shifting primarily aim to accomplish?
What does tax shifting primarily aim to accomplish?
Signup and view all the answers
What is meant by forward shifting of tax?
What is meant by forward shifting of tax?
Signup and view all the answers
Which statement about transformation in tax is true?
Which statement about transformation in tax is true?
Signup and view all the answers
Which type of tax shifting is most common with essential goods and services?
Which type of tax shifting is most common with essential goods and services?
Signup and view all the answers
Study Notes
Government Funding and Taxation
- Government funding is essential for maintaining public services and infrastructure.
- Taxation is the primary means through which the government receives financial support from citizens.
- This funding structure is described as a mutual support system between the government and its people.
Benefits of Public Services
- All citizens automatically benefit from government services, even if these benefits are indirect.
- Examples of public services include infrastructure, healthcare, education, and security.
- Taxpayers cannot avoid tax obligations by claiming they have not directly received benefits.
Theories of Cost Allocation
- Taxation distributes government costs among the population based on specific theories:
- Benefit Received Theory: Tax liability correlates with the level of government benefits received.
- Ability to Pay Theory: Taxpayers contribute according to their financial capability, implying wealthier individuals should pay higher taxes, regardless of the benefits received.
Legislative Framework for Taxation
- Tax bills must originate in the House of Representatives as specified by the Constitution.
- Legislative discretion in taxation includes:
- Object of taxation selection
- Setting tax rates
- Defining the purpose of tax levies for public use
- Types of taxes imposed
- Allocation of tax revenue between national and local governments
- Determining tax situs and collection methods
Assessment and Collection
- Tax laws are enforced by the administrative branch through assessment and collection of tax liabilities.
- This enforcement is referred to as the incidence of taxation.
Situs of Taxation
- Situs refers to the geographic location where taxation takes place, with rules to determine tax jurisdiction.
- Business Tax Situs: Taxes are imposed where a business operates.
- Income Tax Situs on Services: Tax depends on the location where services are rendered.
- Income Tax Situs on Sale of Goods: Tax applies based on the sale's location.
- Property Tax Situs: Property is taxed where it is located, regardless of the owner's residence.
- Personal Tax Situs: Individuals are taxable based on their residence.
Fundamental Doctrines in Taxation
- Marshall Doctrine: Taxation can be used as a mechanism to discourage harmful activities, equating the power to tax with the power to destroy.
- Holmes Doctrine: Taxation can promote beneficial activities through incentives and tax holidays, creating space for economic growth.
- Tax laws typically operate prospectively, although there may be exceptions for specific tax situations.
Important Tax Principles
- Taxes cannot be automatically set off against claims the taxpayer may have against the government.
- Tax obligations are non-transferable; a taxpayer cannot assign tax liabilities to another party.
- The right to collect taxes does not expire unless specifically provided by law; typically, taxes must be collected within five years post-assessment.
Tax Strategies
- Tax Avoidance: Legally reducing tax liabilities through careful planning and strategic financial decisions.
- Tax Exemption: Certain entities may be exempt from taxes, which can be constitutionally or contractually granted.
Tax Burden Shifting
-
Shifting refers to transferring the tax burden across various taxpayers or market segments:
- Forward Shifting: Consumers bear the cost after manufacturers increase prices to cover taxes.
- Backward Shifting: Producers absorb costs, impacting their pricing strategies for certain products.
- Onward Shifting: General tax burden adjustments passed along the supply chain.
- Capitalization: The impact of tax rate changes on asset values, resulting in adjusted market valuations.
- Transformation: Taxpayers may reduce waste to offset the effects of increased taxes, maximizing financial efficiency.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
Explore the critical relationship between government funding and taxation. This quiz covers the significance of public services, the benefits received by citizens, and the theories of cost allocation related to taxation. Understand how these financial systems operate within society.
