UNDER RA 10963

BUSINESS TAXES

(Please provide explanation to your answer i.e. state the section in RR or NCC)

1.Statement 1: Business taxes are based on gross income

Statement 2: Business tax is in addition to income tax

a.Only Statement 1 is correct

b.Only Statement 2 is correct

c.Both Statements are correct

d.Both statements are incorrect

2.Which of the following statements is correct?

I.Vat may be imposed together with other percentage tax

II.Vat may be imposed together with excise tax

III.Vat and other percentage tax may be imposed together with income tax

a.II only

b.III only

c.II and II only

d.I, II, and III

3.Which of the following statements is correct?

a.The seller of goods/services is the one statutorily liable to pay vat.

b.The "burden of tax" is borne by the final consumers although the producers and suppliers of these goods and services are the ones who have to file their VAT returns to the Bureau of Internal Revenue. Hence, what is transferred or shifted to the consumers is not the "liability to pay the tax" but the tax burden

c.Both a and b

d.Neither a nor b

4.Which is correct?

a.All vat-exempt taxpayers shall be subject to other percentage taxes

b.A taxpayer who is subject to percentage tax on his gross receipts will also be subject to income tax on his net income

c.Both a and b

d.Neither a nor b

5.Georgia is a manufacturer of "GJ supermini-cigarettes". In making sales, taxes on the products and transactions are passed on to the buyers. For vat purposes, which of the following forms part of the gross selling price?

a.Value added price

b.Percentage tax

c.Excise tax

d.Income tax

6.Alex imported cigarettes for sale in the Philippines. What business tax will Alex pay?

I.He will pay VAT on importation and on the sale of the cigarettes

II.He will pau excise tax on importation of the cigarettes

a.Both answers are correct

b.Both answers are incorrect

c.Only I is correct

d.Only II is correct

7.Which is correct?

a.An excise tax which imposes a tax based on weight or volume capacity or any other physical unit of measurement is called specific tax

b.An excise tax which imposes a tax based on selling price or other specified value of the article is called ad valorem tax

c.A percentage tax which is imposed whether the transaction resulted in a gain or loss is called transaction tax

d.All of the above

8.A taxpayer imported cigarettes from China for sale. At a later date, he sold the cigarettes in the Philippines. He is subject to value-added tax. He is also subject to business tax of

a.Income tax

b.Percentage tax

c.Excise tax

d.None of the above

9.Who of the following is NOT subject to vat?

a.Vat registered person whose gross sales do not exceed P 3,000,000

b.A nonresident lessor or foreign licensor who is not vat registered.

c.Any person who is required to register under the vat system but failed to register

d.None of the above

10.A non-VAT registered whose sales for the year exceeded P 3,000,000 is

a.Exempt from VAT

b.Subject to 0% of VAT

c.Subject to percentage tax

d.Subject to 12% VAT

11.Which of the following is/are correct?

I.Person whose transactions are exempt from value added tax under Section 109 because their gross sales/and or receipts do not exceed P 3,000,000 may voluntarily apply for registration under the VAT system

II.A VAT-registered person whose gross sales and/or receipts for two (2) consecutive years did not exceed P 3,000,000 may apply for cancellation of VAT registration and revert back to being VAT-exempt under Section 109.

a.I only

b.II only

c.Both I and II

d.Neither I and II

12.Which is incorrect?

a.A taxpayer whose annual gross receipts or sales exceed P 3,000,000 shall pay VAT even if not VAT registered

b.A taxpayer whose annual receipts or sales do not exceed P 3,000,000 but who is VAT registered shall pay VAT

c.The same transaction may be subjected to both income tax and VAT

d.A person whose gross sales or receipts do not exceed P 100,000 is exempt from VAT provided he pays the 3% other percentage tax.