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Multiple Choice - Theory: Part 1 1. Which type of consumption will pay consumption tax? ' a. Domestic consumption b. Foreign consumption c. Both domestic and foreign consumption d. Neither domestic nor foreign consumption 2. Which is a tax upon the usage of income? a. Savings tax c. Consumption tax b. investment tax d. Business tax 3. Which is subjectto the VAT on importation? a. Foreign consumption from resident sellers h. Foreign consumption from foreign sellers c. Domestic consumption from resident sellers d. Domestic consumption from foreign sellers 4. 1Which is subject to business tax? a. Foreign consumption from resident sellers b. Foreign consumption from foreign sellers c. Domestic consumption from resident sellers d. Domestic consumption from foreign sellers 5. Which is an incorrect statement regarding consumption taxes? a. They are always indirect in nature. b. They effectively tax everyone in the state. c. They apply only when the goods or services are destined for consumption within the Philippines. d. Consumption taxes may encourage savings formation. Chapter 1- Introduction to Consumption Taxes 6. Which is correct regarding consumption tax? a. It may help in the redistribution of wealth to society. b. It is entirely based upon the consumers' ability to pay. C. It applies to both domestic and foreign consumption. d. It applies only when the seller is non-resident. 7. Domestic consumption is taxable when the seller is ?) a. a non-resident. b. a resident. c. either a resident or a non-resident. d. both a resident and a non-resident. 8. Foreign consumption shall a. pay consumption tax if the seller is a resident. b. pay consumption tax if the seller is a non-resident. .3 C. not pay consumption tax if the seller is a non-resident. d. not pay consumption tax regardless of the residency of the sell 9. The tax on domestic consumption is referred to as a. VAT on importation. b. Business tax. C. Either A or B d. Neither A nor B 10. The tax on domestic consumption from foreign suppliers is a. VAT on importation. b. Business tax. C. Either A or B d. Neither A nor BTrue or False 1 1. Consumption tax is levied upon businesses. 2. A tax on consumption will effectively result in virtually all residents of the State paying tax. 3. Consumption is the acquisition or utilization of goods and services. 4. A purchase is a form of consumption. 5. Income tax is based on the taxpayers' capacity to sacrifice for the support of the government. 6. Consumption tax is more consistent with the "ability to pay" theory rather than the "benefit received" theory. 7. A tax on consumption would support savings initiative. 8. Consumption taxes should not apply to basic necessities. 9. Both domestic consumption and foreign consumption are subject to consumption tax. 10. Non-resident sellers are exempt from consumption taxes on their domestic sales.; 11. Resident sellers shall pay consumption tax on foreign consumption. 12. The sale by non-resident persons abroad is subject to Philippine consumption tax. 13. The utilization or consumption of goods or services shall be taxable in their country of origin. 14. The sale by non-resident persons in the Philippines is exempt from consumption tax. 15. The sale by resident in the Philippines is subject to consumption tax
