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Questions and Answers
Tax laws can only operate retrospectively if specifically declared by the legislature.
Tax laws can only operate retrospectively if specifically declared by the legislature.
True (A)
The good faith of a taxpayer provides them automatic exemption from paying surcharges for late tax payments.
The good faith of a taxpayer provides them automatic exemption from paying surcharges for late tax payments.
False (B)
The Secretary of Finance can legislate tax laws through the issuance of revenue regulations.
The Secretary of Finance can legislate tax laws through the issuance of revenue regulations.
False (B)
Tax statutes must always receive a literal interpretation to uphold their effectiveness.
Tax statutes must always receive a literal interpretation to uphold their effectiveness.
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Tax treaties can lead to exemptions, credits, or lower rates under Philippine tax laws.
Tax treaties can lead to exemptions, credits, or lower rates under Philippine tax laws.
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Omitting mandatory provisions in tax law renders an act valid.
Omitting mandatory provisions in tax law renders an act valid.
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The prescriptive period to assess national internal revenue taxes is generally 5 years from the last day prescribed by law for the filing of the return.
The prescriptive period to assess national internal revenue taxes is generally 5 years from the last day prescribed by law for the filing of the return.
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The Bureau of Internal Revenue has the authority to collect taxes for up to 10 years in cases of fraud or falsity.
The Bureau of Internal Revenue has the authority to collect taxes for up to 10 years in cases of fraud or falsity.
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Documentary stamp taxes are assessed without the need for an assessment within a general period of 3 years from the date of assessment.
Documentary stamp taxes are assessed without the need for an assessment within a general period of 3 years from the date of assessment.
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The prescriptive period for assessing estate and donor's taxes is always 3 years from the date of actual filing.
The prescriptive period for assessing estate and donor's taxes is always 3 years from the date of actual filing.
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The Regional Director of the Bureau of Internal Revenue is appointed by the Secretary of the Department of Finance.
The Regional Director of the Bureau of Internal Revenue is appointed by the Secretary of the Department of Finance.
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Excise taxes have no prescriptive period for assessment or collection once a return has been filed.
Excise taxes have no prescriptive period for assessment or collection once a return has been filed.
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The authorized agent banks (AAB) are responsible for collecting local business tax (LBT).
The authorized agent banks (AAB) are responsible for collecting local business tax (LBT).
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The Bureau of Customs (BOC) can assess duties for up to 5 years from the final payment.
The Bureau of Customs (BOC) can assess duties for up to 5 years from the final payment.
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Local taxes must be collected within a period of 5 years from the date they became due.
Local taxes must be collected within a period of 5 years from the date they became due.
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The Customs Modernization and Tariff Act (CMTA) allows for a limitation period of 10 years for liquor duties.
The Customs Modernization and Tariff Act (CMTA) allows for a limitation period of 10 years for liquor duties.
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The local government code allows for a deduction of 10 years from the date of assessment for local business taxes.
The local government code allows for a deduction of 10 years from the date of assessment for local business taxes.
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The District Collector has the authority to deputize other customs officers.
The District Collector has the authority to deputize other customs officers.
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Provincial treasurers are solely responsible for the collection of customs duties.
Provincial treasurers are solely responsible for the collection of customs duties.
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The final payment of duties to the Bureau of Customs must be liquidated for a period of 3 years.
The final payment of duties to the Bureau of Customs must be liquidated for a period of 3 years.
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The government can be held accountable for errors made by its agents according to the rule of no estoppel against the government.
The government can be held accountable for errors made by its agents according to the rule of no estoppel against the government.
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The Administrative Issuances are considered sources of tax laws.
The Administrative Issuances are considered sources of tax laws.
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Public purpose is always presumed to be absent in the construction of tax laws.
Public purpose is always presumed to be absent in the construction of tax laws.
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An ex post facto law is permissible under internal revenue laws.
An ex post facto law is permissible under internal revenue laws.
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A statute imposing a tax must be clearly, expressly, and unambiguously constructed to be effective.
A statute imposing a tax must be clearly, expressly, and unambiguously constructed to be effective.
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Erroneous application of tax law by public officers prevents the correct application of statutes from being enforced later.
Erroneous application of tax law by public officers prevents the correct application of statutes from being enforced later.
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In cases of doubt regarding a taxing act, the interpretation is generally most strongly in favor of the government.
In cases of doubt regarding a taxing act, the interpretation is generally most strongly in favor of the government.
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The penalties associated with internal revenue laws are civil in nature rather than penal.
The penalties associated with internal revenue laws are civil in nature rather than penal.
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Local Tax Ordinances are not included as sources of tax laws.
Local Tax Ordinances are not included as sources of tax laws.
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Flashcards
National Internal Revenue Taxes Prescriptive Period (Assessment)
National Internal Revenue Taxes Prescriptive Period (Assessment)
Generally, within 3 years from the last day prescribed for filing a tax return, or if filed later, within 3 years from the date of actual filing.
National Internal Revenue Taxes Prescriptive Period (Collection)
National Internal Revenue Taxes Prescriptive Period (Collection)
Within 3 years from the date of assessment.
Exception to Prescriptive Period
Exception to Prescriptive Period
Within 10 years from the discovery of omission, fraud, or falsity, even without an assessment.
Tax Administration Agencies
Tax Administration Agencies
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Tax Code
Tax Code
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Income tax
Income tax
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Deputized Treasurer
Deputized Treasurer
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Authorized Agent Banks (AAB)
Authorized Agent Banks (AAB)
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Tariff and Customs Duties
Tariff and Customs Duties
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Bureau of Customs (BOC)
Bureau of Customs (BOC)
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Local Business Tax (LBT)
Local Business Tax (LBT)
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5 years (Local Taxes)
5 years (Local Taxes)
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10 years (Local Business Tax)
10 years (Local Business Tax)
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Local Government Code (LGC)
Local Government Code (LGC)
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Tax laws are prospective
Tax laws are prospective
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Tax law exceptions
Tax law exceptions
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Tax laws vs. general laws
Tax laws vs. general laws
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Tax statutes' interpretation
Tax statutes' interpretation
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Tax treaty provisions
Tax treaty provisions
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Mandatory vs. Directory provisions
Mandatory vs. Directory provisions
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Real Property Tax (RPT)
Real Property Tax (RPT)
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Occupational/Professional Tax
Occupational/Professional Tax
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Ad Valorem Tax on Idle Lands
Ad Valorem Tax on Idle Lands
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SEF Tax
SEF Tax
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Tax Laws Sources
Tax Laws Sources
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Rule of No Estoppel Against the Government
Rule of No Estoppel Against the Government
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Tax Laws Nature (Civil)
Tax Laws Nature (Civil)
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Tax Law Construction (Doubt)
Tax Law Construction (Doubt)
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Tax Construction (Public Purpose)
Tax Construction (Public Purpose)
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Tax Law Construction (Clear Language)
Tax Law Construction (Clear Language)
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Study Notes
Taxation 101 - General Principles
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Tax Types and Basis: National Internal Revenue taxes are based on the National Internal Revenue Code/Tax Code as amended by the TRAIN law.
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Prescriptive Periods (Assessment): Generally, taxes are assessable within 3 years of the legally mandated filing deadline for the return or, if filed later, within 3 years from the actual filing date. Exceptions involve fraud or omissions, with assessment possible within 10 years of discovery.
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Prescriptive Periods (Collection): Tax collection has a 3-year window from the date of assessment. This timeframe expands to 10 years from the discovery of an omission or fraud, regardless of whether an assessment has been made.
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Agencies and Agents responsible for Tax Administration: Various government agencies and officers are involved in tax administration, including the Bureau of Internal Revenue (BIR). At the head is the Commissioner, appointed by the President, with regional directors, revenue district officers, revenue collection officers, and deputized treasurers as key elements. Authorized Agent Banks(AAB) are also responsible for collection.
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Tariff and Customs Duties: Customs duties are handled by the Bureau of Customs. A 1-year timeframe starts from the final date the duties were paid, unless the import liquidation process was just tentative.
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Local Taxes, Fees, or Charges: Local governments collect taxes (e.g., Local Business Tax (LBT), Real Property Tax (RPT)) based on Local Government Code (LGC). Assessments may occur within five years from due dates, or even 10 years if fraudulent activity is detected.
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Sources of Tax Laws: Tax laws come from various sources, including statutes (e.g., Train Law), Presidential Decrees, Executive Orders, Court Decisions; Tax Codes (e.g., National Internal Revenue Code), Revenue Regulations, and Administrative Issuances. These must align or if there is conflict, basic law prevails.
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Enforcement and Administration: The BIR, along with Local Tax Ordinances and Tax Treaties and Conventions, enforces tax laws.
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Rule of No Estoppel: The government generally isn't bound by the errors of its agents. However, justice and fair play may mean an exception should the erroneous policies cause injustices for taxpayers involved.
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Nature of Internal Revenue Laws: Tax laws are civil, not political, and aim to compel timely payments. Tax Laws are also not subject to ex-post facto laws.
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Construction of Tax Laws: Tax laws are viewed with a certain purpose in mind and are construed favorably towards the taxpayer in cases of doubt. Generally, tax laws apply prospectively. Exceptions exist if expressly stated or clearly implied in the legislation. Tax laws are special laws and prevail over general laws.
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Provisions of Tax Laws: The provisions of tax laws may be mandatory (regarding notice and tax amounts/rates), or directory (related to tax officer guidelines and methods).
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Powers of the Secretary of Finance: The Secretary of Finance, guided by the Commissioner of Internal Revenue (CIR), is empowered to create regulations to bolster the enforcement of tax codes. They cannot, however, utilize these powers to make laws.
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Powers of the Commissioner of Internal Revenue (CIR): The CIR has exclusive authority to interpret and decide tax-related issues, but these interpretations are subject to the Secretary of Finance's review. However, the CIR cannot delegate the recommendation of internal revenue rules and regulations to their subordinates. Certain important ruling creation can't be delegated.
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CIR Issuances/Regulation types: Revenue Memorandum Circulars(RMCS), Revenue Memorandum Orders (RMOs), and BIR Rulings explain or clarify tax laws.
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Tax Regulations: Regulations are essential for enforcing and executing tax laws. Regulations' validity depends on adherence to the law, consistency with the constitution, and official publishing. They operate prospectively unless expressly stated otherwise.
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Force and Effect of Regulations: Tax Regulations have the same force as laws, but they may be declared null and void if deemed legally contradictory. Courts pay attention to executive policies but aren't bound by them.
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Court Decisions: Tax cases can be judged by the Court of Tax Appeals (CTA) and appealed further to the Supreme Court.
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Description
This quiz covers the fundamental concepts of taxation, including the different types of taxes based on the National Internal Revenue Code and the implications of the TRAIN law. Explore the prescriptive periods for both assessment and collection, and learn about the agencies responsible for tax administration. Test your understanding of these crucial tax principles.
