TAX
Mr. Malas sells shoes in Makati through a retail store. He pays VAT on his gross sales to the BIR and the municipal license tax based on the same gross sales to the City of Makati. He comes to you for advice because he thinks he is being subjected to double taxation. What advice will you give him? O a. Yes, there is double taxation and it is oppressive. O b. The City of Makati does not have this power c. Yes, there is double taxation and O this is illegal in the Philippines. d. Double taxation is allowed where O one is imposed by the national government and the other by the local government.One of the characteristics of internal revenue laws is that they are: a. Criminal in nature O b. Penal in nature O c. Political in nature O d. Generally prospective in application.Which of the following is not a scheme of shifting the incidence of taxation? a. A manufacturer transfer tax to the consumer by adding tax to the selling price of the goods sold. O b. A tax forms part of the purchase price. c. Changing the terms of the sale like FOB shipping point in the O Philippines to FOB destination abroad, so that the title passes abroad instead of in the Philippines. d. The manufacturer transfers the O sales tax to the distributor, then in turn to the wholesaler, in turn to the retailer, and finally to the consumer.Situs of taxation is the place of taxation. Which of the statements is not true about situs? O A. Situs of persons is the residence of the taxpayer O B. citizenship, in determining the situs, is not a factor to consider O C. subject matter is a must to determine situs D. none of the aboveRAF Corporation secured an income tax holiday for 5 years as a pioneer industry. On the fourth year of the tax holiday, RAF Corporation declared and paid cash dividends to its stockholders, all of whom are individuals. Are the dividends taxable? a. The dividends are taxable, the tax O exemption of RAF Corporation does not extend to its stockholders. b. The dividends are tax-exempt O because of RAF Corporation's income tax holiday. c. The dividends are taxable if they O exceeded 50% of RAF Corporation's retained earnings. d. The dividends are exempt if paid O before the end of RAF Corporation fiscal year.Which of the following statements is wrong? A revenue bill: O a. May be recommended by the President to Congress. b. May have a House version and a Senate version approved separately O and then consolidated with both houses approving the consolidated version. c. May originate from the Senate and on which same bill the House of Representatives may propose amendments. d. May originate from the House of O Representatives and on which same bill the Senate may propose amendments.The municipality of San Isidro passed an ordinance imposing a tax on installation managers. At the time, there was only one installation manager in the municipality, thus, only he would be liable for the tax. Is the law constitutional? a. It is unconstitutional because it O clearly discriminates against this person. O b. It is unconstitutional for lack of legal basis. O c. It is constitutional as it applies to all persons in that class. O d. It is constitutional because the power to tax is the power to destroy.The Local Government Code took effect on January 1, 1002. PLDT's legislative franchise was granted sometime before 1992. Its franchise provides that PLDT will only pay3% franchise tax in lieu of all taxes The legislative franchises of Smart and Globe Telecoms were granted in1998. Their legislative franchise state that they will pay only 5% franchise tax in lieu of all taxes. The Province of Zamboanga del Norte passed an ordinance in 1997 that imposes a local franchise tax on all telecommunication companies operating within the province. The tax is 50% of 1% of the gross annual receipts of the preceding calendar year based on the incoming receipts, or receipts realized, within its territorial jurisdiction. Is the ordinance valid?lieu of all taxes. The Province of Zamboanga del Norte passed an ordinance in 1997 that imposes a local franchise tax on all telecommunication companies operating within the province. The tax is 50% of 1% of the gross annual receipts of the preceding calendar year based on the incoming receipts, or receipts realized, within its territorial jurisdiction. Is the ordinance valid? a. No, the ordinance in effect resulted into double taxation. b. No, the Local Government Code prevails over ordinances. o. Yes, the local government units O are empowered by the Constitution to raise its own revenues. O d. Yes, autonomy of Zamboanga del Norte.Which among the following concepts of taxation is the basis for the situs of income taxation? a. Lifeblood doctrine of taxation O b. Symbiotic relation in taxation O c. Compensatory purpose of taxation O d. Sumptuary purpose of taxation
