46747647 Beda Tax Reviewer
Short Description
Download 46747647 Beda Tax Reviewer...
Description
TAXA TAXATION: TION: San Beda College of LAW – ALABANG
d. in the rea& rea& of tax tax exeptions and tax re&iefs, for instance, the purpose is to %rant incenti$es or exeptions in order to encoura%e in$estents and there!" proote the countr"s econoic %ro#th.
, it is a eans !" #hich the so$erei%n, throu%h its &a#'a(in% !od", raises re$enue to defra" the necessar" expenses of the %o$ernent. It is ere&" a #a" of apportionin% the costs of %o$ernent aon% those #ho in soe easures are pri$i&e%ed to en)o" its !enefits and ust !ear its !urdens. , taxation refers to the inherent po#er of the state to deand enforced contri!utions for pu!&ic purpose or purposes.
e. in soe iportant sectors of the econo", as in the case case of forei% forei%nn ipor iportat tatio ions, ns, taxes taxes soet soeti ies es pro$i pro$ide de protection to &oca& industries &i(e protecti$e tariffs and custos.
Taxes are the enforced proportiona& contri!utions fro persons and propert" &e$ied !" the &a#'a(in% !od" of the State !" $irtue of its so$erei%nt" for the support of %o$ernent and for pu!&ic needs. @ ; LE?P S <
The Supree Court he&d: *It is said that taxes are #hat #e pa" for ci$i&i+ed societ". ithout taxes, the %o$ernent #ou&d !e para&"+ed for &ac( of the oti$e po#er to acti$ate and operate it. -ence, despite the natura& re&uctance to surrender part of ones hard'earned incoe to the taxin% authorities, e$er" person #ho is a!&e ust contri!ute his share in the runnin% of the %o$ernent. The %o$ernent for its part is expected to respond in the for of tan%i!&e and intan%i!&e !enefits intended to ipro$e the &i$es of the peop&e and enhance their ora& and ateria& $a&ues. The and shou&d dispe& the erroneous notion that it is an ar!itrar" ethod of exaction !" those in the seat of po#er. Taxation is a s"!iotic re&ationship, #here!" in exchan%e for the protection that the citi+ens %et fro the %o$ernent, taxes are paid./ 0Coissioner of Interna& Re$enue $s A&&e%re, Inc.,et a&., L' 12234, 5e!. 67, 63228
6. to pro$ide funds or propert" #ith #hich the State prootes the %enera& #e&fare and protection of its citi+ens. 1.
1
;PR EP<
a. Taxation a" !e used as an ip&eent of po&ice po#er in in order to proote the %enera& #e&fare of the peop&e. ;see Lut+ $s Araneta 032 Phi& 6=28 and 9se>a $s 9r!os 0G.R. No. 33224, ?ar. @6, 633@8< !. As in the case of taxes &e$ied on excises and pri$i&e%es &i(e those iposed in to!acco or a&coho&ic products or auseent p&aces &i(e ni%ht c&u!s, ca!arets, coc(pits, etc. In the case of Ca&tex Phi&s. Inc. $s C9A 0G.R. No. 312, ?a" 2, 63318, it #as he&d that taxes a" a&so !e iposed for a re%u&a re%u&ator tor"" purpos purposee as, as, for instan instance, ce, in the reha!i reha!i&i&itat tation ion and sta!i&i+ation of a threatened industr" #hich is affected #ith pu!&ic industr" &i(e the oi& industr". c. this this is ade possi!& possi!&ee throu%h the pro%ressi$e s"ste of taxation #here the o!)ecti$e is to pre$e pre$ent nt the under' under'con conce centr ntrati ation on of #ea&t #ea&thh in the hands hands of fe# indi$idua&s.
6. It is is &e$ &e$ie iedd !" !" tthe he of the State The po#er to tax is a &e%is&ati$e po#er #hich under the Constitution on&" Con%ress can exercise throu%h the enactent of &a#s. Accordin%&", the o!&i%ation to pa" taxes is a statutor" &ia!i&it". 1. It is is an contri!ution A tax is not a $o&untar" pa"ent or donation. It is not dependent on the #i&& or contractua& assent, express or ip&ied, of the person taxed. Taxes are not contracts !ut positi$e acts of the %o$ernent. @. It is %enera %enera&&&&"" pa"a!& pa"a!&ee in Tax is a pecuniar" !urden an exaction to !e dischar%ed a&one in the for of one" #hich ust !e in &e%a& tender, un&ess Bua&ified !" &a#, such as RA @= #hich a&&o#s !ac(pa" certificates as pa"ent of taxes. =. It is in character ' It is ordinari&" !ased on the taxpa"ers a!i&it" to pa" . pa" . . It is &e$i &e$ied ed on A tax a" a" a&so !e iposed iposed on acts, transactions, ri%hts or pri$i&e%es. 4. It is is &e$ &e$ie iedd for for Taxation in$o&$es, and a tax constit constitute utes, s, a !urden !urden to pro$i pro$ide de incoe incoe for pu!&i pu!&icc purposes. 7. It is is &e$ &e$ie iedd !" !" tthe he #hich has )urisdiction o$er the persons or propert". ' The persons, propert" or ser$ice to !e taxed ust !e su!)ect to the )urisdiction of the taxin% state.
Taxes proceed upon the theor" that the existence of the %o$ernent is a necessit" that it cannot continue #ithout the eans to pa" its expenses and that for those eans, it has the ri%ht to cope& a&& citi+ens and properties #ithin its &iits to contri!ute. In a case, the Supree Court he&d that: 1
TAXA TAXATION: TION: San Beda College of LAW – ALABANG Taxati Taxation on is a po#er po#er eanatin eanatin%% fro necessit" necessit".. It is a necessar" !urden to preser$e the States so$erei%nt" and a eans to %i$e the citi+enr" an ar" to resist a%%ression, a na$" to defend its shore shoress fro fro in$asi in$asion, on, a corps corps of ci$i& ci$i& ser$an ser$ants ts to ser$e, ser$e, pu!&ic pu!&ic ipro$eents desi%ned for the en)o"ent of the citi+enr" and those #hich coe #ith the States territor" and faci&ities, and protection #hich a %o$ernent is supposed to pro$ide. 0Phi&. Guarant" Co., Inc. $s Coissioner of Interna& Re$enue, 6@ SCRA 778.
The !asis of taxation is the reciproca& dut" of protection !et#een the state and its inha!itants. In return for the contri!utions, the taxpa"er recei$es the %enera& ad$anta%es and protection #hich the %o$ernent affords the taxpa"er and his propert".
1. The po#er to tax is exc&usi$e&" &e%is&at &e%is&ati$e i$e and cannot cannot !e exercise exercisedd !" the executi$ executi$ee or )udicia& )udicia& !ranch of the %o$ernent. @. A&thou%h in one decided case the Supree Court ca&&ed it an a#esoe po#er, the po#er of taxation is su!)ect to certain &iitations. ?ost of these &iitatio &iitations ns are specific specifica&&" a&&" pro$ided in the Constitu Constitution tion or ip&ied ip&ied therefro #hi&e the rest are inherent and the" are those #hich sprin% fro the nature of the taxin% po#er itse&f a&thou%h, the" a" or a" not !e pro$ided in the Constitution.
;S1 A P A ?< 6. to !e taxed8
a. It does does not ean ean that that on&" those those #ho #ho are a!&e a!&e to pa" and do pa" taxes can en)o" the pri$i&e%es and protection %i$en to a citi+en !" the %o$ernent. !. 5ro the the contri!utio contri!utions ns recei$ed recei$ed,, the %o$erne %o$ernent nt renders renders no specia& or coensurate !enefit to an" particu&ar propert" or person. c. The on&" on&" !enefit !enefit to #hich #hich the taxpa"er taxpa"er is entit& entit&ed ed is that deri$e deri$edd fro his en)o"ent of the pri$i&e%es of &i$in% in an or%ani+ed societ" esta!&is esta!&ished hed and safe%uard safe%uarded ed !" the de$otion de$otion of taxes taxes to pu!&ic pu!&ic purposes. 0Goe+ $s Pa&oar, 1 SCRA 2138 d. A taxpa" taxpa"er er cannot cannot o!)ect o!)ect to or resist resist the pa"ent pa"ent of taxes so&e&" !ecause no persona& !enefit to hi can !e pointed out as arisin% fro the tax. 0Loren+o tax. 0Loren+o $s Posadas, 4= Phi& @@8
Taxes are the &ife!&ood of the %o$ernent, !ein% such, their propt propt and certain a$ai&a!i&i a$ai&a!i&it" t" is an iperious iperious need. need. 0Co&&ector of Interna& Re$enue $s. Goodrich Internationa& Ru!!er Co., Sept. 4, 6348 ithout ithout taxes, the %o$ernent #ou&d !e para&"+ed for &ac( of oti$e po#er to acti$ate and operate it.
6. The po#er of taxation is inherent in so$erei%nt" as an incident or attri!ute thereof, !ein% essentia& to the exis existe tenc ncee of e$er e$er"" %o$e %o$ern rne ent nt.. It can can !e exer exerci cise sedd !" the the %o$ernent e$en if the Constitution is entire&" si&ent on the su!)ect. a. Constitut Constitutiona iona&& pro$ision pro$isionss re&atin% n% to the po#er po#er of taxation taxation do not operate as %rants of the po#er to the %o$ernent. The" ere&" const constitu itute te &iit &iitati ations ons upon upon a po#er po#er #hich #hich #ou&d #ou&d other# other#ise ise !e practica&&" #ithout &iit. !. hi&e hi&e the the po#er to tax is not expres express&" s&" pro$i pro$ided ded for in our constitutions, constitutions, its existence is reco%ni+ed !" the pro$isions re&atin% to taxation. In the case of ?actan Ce!u Internationa& Airport Authorit" $s ?arcos, Sept. 66, 6334, as 6334, as an incident of so$erei%nt", the po#er to tax has !een descri!ed as *un&iited in its ran%e, ac(no#&ed%in% in its $er" nature no &iits, so that securit" a%ainst its a!use is to !e found on&" in the responsi!i&it" of the &e%is&ati$e #hich iposes the tax on the constituenc" #ho are to pa" it./
0the persons, propert" or occupation etc.
In the case of Churchi&&, et a&. $s Concepcion 0@= Phi& 3438 it has !een ru&ed that: The po#er to ipose taxes is one so un&iited in force and so searchin% in extent so that the courts scarce&" $enture to dec&are that it is su!)ect to an" restriction #hate$er, except such as rest in the discre discretio tionn of the author authorit" it" #hich #hich exerc exercise ise it. No attri! attri!ute ute of so$erei%nt" is ore per$adin%, and at no point does the po#er of %o$ernent affect ore constant&" and intiate&" a&& the re&ations of &ife than throu%h the exaction ade under it. And in the nota!&e case of ?cCu&&och $s ?ar"&and, Chief ustice ?arsha&& &aid do#n the ru&e that the . Accordin% to an authorit", authorit", the a!o$e princip&e is pertinent on&" #hen there is no po#er to tax a particu&ar su!)ect and has no re&ation to a case #here such ri%ht to tax exists. This opt'Buoted axi instead of !ein% re%arded as a !&an(et authori+ation of the unrest unrestrai rained ned use of the taxin% taxin% po#er for an" and a&& purpose purposes, s, irresp irrespect ecti$ i$ee of re$enu re$enue, e, is ore ore reason reasona!& a!&"" constr construed ued as an epi%raatic stateent of the po&itica& and econoic axio that since the financia& needs of a state or nation a" outrun an" huan ca&cu&ation, so the po#er to eet those needs !" taxation ust not !e &ii &iite tedd e$en e$en thou thou%h %h the the taxe taxess !eco !ecoe e !urd !urden enso soe e or confiscator". To sa" that *the po#er to tax is the po#er to destro"/ is to descri!e not the purposes for #hich the taxin% po#er a" !e used !ut the de%ree of $i%or #ith #hich the taxin% po#er a" !e ep&o"ed in order to raise re$enue 0I Coo&e" 673'6268
hi&e taxation is said to !e the po#er to destro", it is !" no eans un&iited. It is eBua&&" correct to postu&ate that the * ,/ 2
TAXA TAXATION: TION: San Beda College of LAW – ALABANG !ecause of the constitutiona& restraints p&aced on a taxin% po#er that $io&ated fundaenta& ri%hts. In the case of Roxas, Roxas, et a& $s CTA 0Apri& 14, 63428 , 63428 , the SC reinds us that a&thou%h the po#er of taxation is soeties ca&&ed the po#er to destro", in order to aintain the %enera& pu!&ics trust and confidence in the Go$ernent, this po#er ust !e used )ust&" and not treacherous&". The Supree Court he&d: *The po#er of taxation is soeties ca&&ed a&so the po#er to destro". Therefore it shou&d !e exercised #ith caution to inii+e in)ur" to the proprietar" ri%hts of a taxpa"er. It ust !e exercised fair&", eBua&&" and unifor&", &est the tax co&&ector (i&& the J hen that &a"s the %o&den e%% .. And, in order to aintain the %enera& pu!&ic trust and confidence in the Go$ernent this po#er ust !e used )ust&" and not not treacherous&". treacherous&".// The The doct doctri rine ne see( see(ss to desc descri ri!e !e,, in an extr extre ee, e, the the conseBuentia& conseBuentia& nature of taxation and its resu&tin% ip&ications, to #it: a. The po#er po#er to tax ust ust !e exerci exercised sed #ith #ith caution caution to ini inii+e i+e in)ur" to proprietar" ri%hts of a taxpa"er !. If the tax tax is &a#fu& &a#fu& and and not $io&at $io&ati$e i$e of an" an" of the inhere inherent nt and constitutiona& constitutiona& &iitations, the fact a&one that it a" destro" an acti$it" or o!)ect of taxation #i&& not entire&" perit the courts to afford an" re&ief and c. A su!)e su!)ect ct or o!)ect o!)ect that that a" not !e destro" destro"ed ed !" the taxin% taxin% authorit" a" not &i(e#ise !e taxed. 0e.%. exercise of a constitutiona& ri%ht8
The courts cannot re$ie# the #isdo or ad$isa!i&it" or exped expedien ienc" c" of a tax. tax. The The court courts s po#er is &iit &iited ed on&" on&" to the app&ication app&ication and interpretation of the &a#. udicia& action is &iited on&" to re$ie# #here in$o&$es: 6. The dete deterrina inati tioon of $a&i $a&idi dit" t" on the tax in re& re&ati ation to constitutiona& constitutiona& precepts or pro$isions. 1. The deteri deterinatio nation, n, in an appropriat appropriatee case, of the the app&icati app&ication on of the &a#.
6. deterination of the persons, propert" or excises to !e taxed, taxed, the su or sus sus to !e raised, the due date thereof and the tie and anner of &e$"in% and co&&ectin% taxes 0strict&" spea(in%, such refers to taxation8 1. consi consists sts of the anner anner of enforc enforcee eent nt of the o!&i%ation on the part of those #ho are taxed. 0this inc&udes pa"ent !" the taxpa"er and is referred to as tax adinistration8 The t#o t#o proces processe sess to%eth to%ether er consti constitut tutee the * /. ;5AT< 6. the sources of tax re$enue shou&d coincide #ith, and approxiate the needs of %o$ernent expenditure. Neither an exces excesss nor a defic deficien ienc" c" of re$enu re$enuee $is'K $is'K'$i '$iss the needs needs of %o$ernent #ou&d !e in (eepin% #ith the princip&e. 1. tax &a#s shou&d !e capa!&e of con$enient, )ust and effecti$e adinistration. adinistration.
@. the tax !urden shou&d !e in proportion to the taxpa"e taxpa"ers rs a!i&it" a!i&it" to pa" 0a!i&it"'to'pa" princip&e8 . The The 6327 6327 Constitution reBuires taxation to !e eBuita!&e and unifor.
.
A.
6. taxes of fixed aount upon a&& persons of a certain c&ass #ithin the )urisdiction of the taxin% po#er #ithout re%ard to the aount of their propert" or occupations or !usinesses in #hich the" a" !e en%a%ed in. exap&e: counit" tax 1. taxes on thin%s or propert" of a certain c&ass #ithin the )urisdiction of the taxin% po#er. exap&e: rea& estate tax @. char%es iposed upon the perforance of an act, the en)o"ent of a pri$i&e%e, or the en%a%in% in an occupation. exap&es: exap&es: incoe tax, $a&ue'add $a&ue'added ed tax, estate tax or donors tax
B.
6. taxes #herein !oth the *incidence/ as as #e&& as the *ipact/ or or !urden of the tax faces on one person. exap&es: incoe tax, counit" tax, donors tax, estate tax 1. taxes #herein the incidence of or the &ia!i&it" for the pa"ent of the tax fa&&s on one person, !ut the !urden thereof can !e shifted or passed to another person. exap&es: AT, percenta%e taxes, custos duties excise taxes on certain specific %oods
: 6. hen the consuer or end'user of a anufacturer product is tax'exept, such exeption co$ers on&" those taxes for #hich such consu consuer er or end'us end'user er is direct direct&" &" &ia!& &ia!&e. e. Indire Indirect ct taxes taxes are not inc&uded. -ence, the anufacturer cannot c&ai exeption fro the pa"ent of sa&es tax, neither can the consuer or !u"er of the product deand the refund of the tax that the anufacturer i%ht ha$e passed on to hi. 0Phi&. Acet"&ene Acet"&ene Co. inc. $s Coissioner of Interna& Re$enue et. a&., L'6377, Au%.67, 63278 1. hen the transaction itse&f is the one that is tax'exept !ut throu%h error the se&&er pa"s the tax and shifts the sae to the !u"er, the se&&er se&&er %ets %ets the refund, refund, !ut ust ho&d it in trust trust for !u"er. !u"er. 0Aerican Ru!!er Co. case, L'634@, Apri& @, 634@8 @. here the exeption fro indirect tax is %i$en to the contractee, !ut the e$ident intention is to exept the contractor so that such contractor a" no &on%er shift or pass on an" tax to the contractee, 3
TAXA TAXATION: TION: San Beda College of LAW – ALABANG the the cont contra ract ctor or a" a" c&ai c&ai tax tax exe exept ptio ionn on the the tran transa sact ctio ionn 0Coissioner of Interna& Re$enue $s ohn Gotaco and Sons, Inc., et.a&., L'@631, 5e!. 17, 63278 =. hen hen the &a# %ranti %rantin% n% tax exept exeption ion speci specific fica&& a&&"" inc&ud inc&udes es indirect taxes or #hen it is c&ear&" anifest therein that &e%is&ati$e intention to exept e!races indirect taxes, then the !u"er of the product or ser$ice so&d has a ri%ht to !e rei!ursed the aount of the tax taxes that hat the the se&& se&&er erss pass passed ed on to hi. i. 0?aced 0?acedaa $s ?acarai%,supra8
C.
6. tax iposed for the %enera& purposes of the %o$ernent, i.e., to raise re$enues for %o$ernenta& needs. Exap&es: incoe taxes, AT, and a&ost a&& taxes 1. tax iposed for specia& purposes, i.e., to achie$e soe socia& or econoic needs. Exap Exap&es &es:: educa educatio tiona& na& fund fund tax under under Rea& Rea& Pr Prope opert" rt" Taxation D.
6. tax iposed per head, unit or nu!er, or !" soe standard of #ei%ht or easureent and #hich reBuires no assessent !e"ond a &istin% and c&assification of the su!)ects to !e taxed. Exap&es: taxes on disti&&ed spirits, #ines, and ferented &iBuors 1. tax !ased on the $a&ue of the artic&e or thin% su!)ect to tax. exap&e: rea& propert" taxes, custos duties
exap&es: nationa& interna& re$enue taxes, custos duties 1.
tax iposed !" Loca& Go$ernent units. exap&es: rea& estate tax, professiona& tax
A re%ressi$e tax, ust not !e confused #ith re%ressi$e s"ste of taxation. tax the rate of #hich decreases as the tax !ase increases. focuses focuses on indirect indirect taxes, it exists #hen there are ore indirect taxes iposed than direct taxes.
a. su of one" for the use of soethin%, %enera&&" app&ied to the consideration #hich is paid for the use of a road, !rid%e of the &i(e, of a pu!&ic nature.
6. deand of so$erei%nt" 1. paid paid for for the supp suppor ortt of the the %o$ernent @. %enera&&", no &iit as to aount iposed =. iposed %o$ernent
on&"
!"
the
6. deand of proprietorship 1. paid paid for for the use use of anot anothe hers rs propert" @. aoun aountt depen depends ds on on the the cost cost of construct construction ion or aintenan aintenance ce of the pu!&ic ipro$eent used =. ipo ipose sedd !" the the %o$er %o$ern nen entt or pri$ate indi$idua&s or entities
!. an" sanctions iposed as a punishent for $io&ations of &a# or acts deeed in)urious.
E.
6. the rate or the aount of the tax increases as the aount of the incoe or earnin% 0tax !ase8 to !e taxed increases. exap&es: incoe tax, estate tax, donors tax 1. the tax rate decreases as the aount of incoe or earnin% 0tax !ase8 to !e taxed increases. Note: e ha$e no re%ressi$e taxes 0this is accordin% to De Leon8 @. re%ressi$e. =.
tax rates are part&" part&" pro%ress pro%ressi$e i$e and part&" part&"
tax rates are fixed fixed on a f&at tax tax !ase. exap&es: rea& estate tax, AT, and other percenta%e taxes
F.
6.
tax iposed !" the Nationa& Go$ernent. Go$ernent.
6. %ene %enera ra&&&&"" inte intend nded ed to rais raisee re$enue 1. iposed on&" !" the %o$ernent
6. desi% desi%ned ned to to re%u&a re%u&ate te condu conduct ct 1. ipo ipose sedd !" the the %o$er %o$ern nen entt or pri$ate indi$idua&s or entities
c. an enfo enforc rced ed prop propor ortition ona& a& contri!ution fro o#ners of &ands especia&&" or pecu&iar&" !enefited !" pu!&ic ipro$eents.
6. iposed on persons, propert" and excise 1. persona& &ia!i&it" of the person assessed
@. !ase !asedd on neces necessi sit" t" as #e&& #e&& as on !enefits recei$ed =. %ener enera& a& app& pp&icati ation 0see 0see
6. &e$i &e$ied ed on& on&"" on &and &and 1. not a perso persona& na& &ia! &ia!i&i&it" it" of of the person assessed, i.e. his &ia!i&it" is &iited ited on&" on&" to the the &and and in$o&$ed @. !ased !ased #ho& #ho&&" &" on on !ene !enefit fitss =. excepti eptioona& na& !oth oth as ti tie and and 4
TAXA TAXATION: TION: San Beda College of LAW – ALABANG Aposto&ic Prefect $s Treas. 9f p&ace a%uio, 76 Phi& =78
re$enue is a&so o!tained does not a(e the iposition of a tax. 0see Pro%ressi$e De$e&opent Corp. $s Fue+on Cit", 671 SCRA 4138 e.
6. Since specia& assessents are not taxes #ithin the constitutiona& or statut statutor" or" pro$i pro$isio sions ns on tax exep exeptio tions, ns, it fo&&o# fo&&o#ss that that the exeption under Sec. 120@8, Art. I of the Constitution does not app&" to specia& assessents. 1. -o#e$er -o#e$er,, in $ie# of the exeptin% exeptin% pro$iso pro$iso in Sec. 1@= of the Loca& Go$ernent Code, properties #hich are actua&&", direct&" and exc&usi$e&" used for re&i%ious, charita!&e and educationa& purposes are not exact&" exept exact&" exept fro rea& propert" taxes !ut are exept fro the iposition of specia& assessents as #e&&.0 see A!an8 @ .The %enera& ru&e is that an exeption fro taxation does not inc&ude exeption fro specia& assessent. d. is a char%e iposed under the po&ice po#er for the purposes of re%u&ation.
6. enforced contri!ution assessed !" so$erei%n authorit" to defra" pu!&ic expenses 1. for re$enue purposes @. an exerc ercise of the tax taxin% po#er =. %enera&&" no &iit in the aount of tax to !e paid
6. &e%a& copensation or re#ard of an officer for specific purposes 1. for re%u&ation purposes @. an exerc ercise of the po&i o&ice po#er =. aount is &iited to the necessar" expenses of inspection and re%u&ation . ipos posed ed a&so on pers ersons . iposed on the ri%ht to and propert" exercise pri$i&e%e 4. non'pa"ent does not 4. non' non'pa pa" "en entt a(es a(es the act act nece necess ssar ari&i&"" a(e a(e the the act act or or !usiness i&&e%a& !usiness i&&e%a&
De!t is !ased upon )uridica& tie, created !" &a#, contracts, de&icts or Buasi'de&icts !et#een parties for their pri$ate interest or resu&tin% fro their o#n acts or oissions. oissions.
6. !ased on &a# 1. %enera&&", cannot !e assi%ned @. %ener enera& a&&" &" pa" pa"a!& a!&e in one" one" =. %ene %enera ra&&&&"" not su!)e su!)ect ct to set' set' off or copensation . ipr ipris ison one ent nt is a sanc sanctition on for non'pa"ent non'pa"ent of tax except po&& tax 4. %o$erned !" specia& prescripti$e periods pro$ided for in the Tax Code 7. does not dra# interest except on&" #hen de&inBuent
6. !ased on contracts, express or ip&ied 1. assi%n i%na!&e a!&e @. a" !e paid aid in (ind =. a" a" !e su!) su!)ec ectt to set'o set'off ff or copensation . no ip ipris rison onent for non' on' pa"ent of de!t 4. %o$er o$erne nedd !" the the ordi ordinnar" ar" periods of prescriptions 7. dra#s interest #hen so stipu&ated, or in case of defau&t
Taxes xes are are not not su!)e u!)ect ct to set'o et'off ff or &e%a &e%a&& copensation. The %o$ernent and the taxpa"er are not creditors and de!tors or each other. 9!&i%ations in the nature of de!ts are due to the %o$ernent in its corporate capacit", #hi&e taxes are due to the %o$ernent in its so$erei%n capacit" 0 Phi&ex ?inin% Corp. $s CIR, 13= SCRA 427 Repu!&ic $s ?a!u&ao Lu!er Co., 4 SCRA 4118 here here !oth !oth the c&ais c&ais of the %o$ern %o$ernent ent and the taxp taxpa" a"er er a%ai a%ains nstt each each othe otherr ha$e ha$e a&re a&read ad"" !eco !ecoe e due due and and deanda!&e as #e&& as fu&&" &iBuated. 0see Doin%o $s Gar&itos, L' 623=, une 13, 634@8
6. Licenses Licenses for for the re%u&at re%u&ation ion of usefu& usefu& occupa occupation tions. s. 1. Lice Licens nses es for for the the re%u re%u&a &atition on or rest restri rict ctio ionn of non' non'us usef efu& u& occupations or enterprises @. Licens Licenses es for for re$e re$enue nue on&" on&" G.R. No. 617=, Au%. 12, 6332
6. Soe &iitations app&" on&" to one and not to the other, and that exeption fro taxes a" not inc&ude exeption fro &icense fees. 1. The po#er to re%u&ate as an exercise of po&ice po#er does not inc&ud inc&udee the po#er to ipos iposee fees fees for re$enue re$enue purpos purposes. es. 0see Aerican ?ai& Line $s Cit" of utuan, L'614=7, ?a" @6, 6347 and re&ated cases8 @. An extraction, ho#e$er, a"!e considered !oth a tax and a &icense fee. =. ut a tax a" ha$e on&" a re%u&ator" purpose. . The %enera& ru&e is that the iposition is a tax if its priar" purpose is to %enerate re$enue and re%u&ation is ere&" incidenta& !ut if re%u&ation is the priar" purpose, the fact that incidenta&&"
The Supree Court he&d that: *e ha$e consistent&" ru&ed that there can !e no offsettin% of taxes a%ainst the c&ais that the taxpa"er a" ha$e a%ainst the %o$ernent. A person cannot refuse to pa" a tax on the %round that the %o$ernent o#es hi an aount eBua& to or %reater than the tax !ein% co&&ected. The co&&ection of a tax cannot a#ait the resu&ts of a &a#suit a%ainst the %o$ernent./ f. 6. a pecuniar" aid direct&" %ranted !" the %o$ernent to an indi$idua& or pri$ate coercia& enterprise deeed !eneficia& to the pu!&ic.
5
TAXATION: San Beda College of LAW – ALABANG 1. refers to a&& the funds or incoe deri$ed !" the %o$ernent, #hether fro tax or fro #hate$er source and #hate$er anner. @. taxes iposed on %oods exported fro or iported into a countr". The ter taxes is !roader in scope as it inc&udes custos duties. =.
it a" !e used in @ senses: a. As a !oo( of rates dra#n usua&&" in a&pha!etica& order containin% the naes of se$era& (inds of erchandise #ith the correspondin% duties to !e paid for the sae. !. As duties pa"a!&e on %oods iported or exported 0PD No. 1@8 c. As the s"ste or princip&e of iposin% duties on the iportationMexportation of %oods. . refers to taxes iposed !" the &e%is&ati$e other than duties or iports and exports. 4. currenc".
a currenc" easure desi%ned to sta!i&i+e the
7. s"non"ous #ith tax taxation ip&ies tri!ute fro the %o$erned to soe for of so$erei%nt". 2. in its %enera& sense, it si%nifies an" tax, tri!ute or dut". In its &iited sense, it eans a dut" on iported %oods and erchandise.
6. Po&ice Po#er 1. Po#er of Einent Doain @. Po#er of Taxation
PRP9SE ' &e$ied for the exercised to purpose of proote pu!&ic raisin% re$enue #e&fare thru re%u&ations A?9NT 95 EOACTI9N ' no &iit ' &iited to the cost of re%u&ations, issuance of the &icense or sur$ei&&ance ENE5ITS RECEIED ' no specia& or ' no direct direct !enefits !enefits !ut a recei$ed !ut the hea&th" econoic en)o"ent of standard of the pri$i&e%es of societ" or &i$in% in an *danu or%ani+ed a!sBue in)uria/ is societ" attained
N9N'I?PAIR?ENT 95 C9NTRACTS ' the ipairent ' contract a" !e ' contracts a" !e ru&e su!sist ipaired ipaired TRANS5ER 95 PR9PERT RIG-TS ' taxes paid ' no transfer !ut ' propert" is ta(en !" !ecoe part of on&" restraint on the %o$t upon pu!&ic funds the exercise of pa"ent of )ust propert" ri%ht copensation exists SC9PE ' affects a&& ' affects a&& ' affects on&" the persons, persons, particu&ar propert" propert" and propert", coprehended excise pri$i&e%es, and e$en ri%hts ASIS ' pu!&ic ' pu!&ic necessit" 'pu!&ic necessit", necessit" and the ri%ht of pri$ate propert" is the state and the ta(en for pu!&ic use pu!&ic to se&f' protection and se&f'preser$ation AT-9RIT -IC- EOERCISES T-E P9ER ' on&" !" the ' on&" !" the ' a" !e %ranted to %o$ernent or %o$ernent or its pu!&ic ser$ice, its po&itica& po&itica& copanies, or pu!&ic su!di$isions su!di$isions uti&ities
a. or those #hich restrict the po#er a&thou%h the" are not e!odied in the Constitution ;P N I T E<
' ta(in% of propert" for pu!&ic use
6. 1. @. =. .
Purpose of Taxes 'de&e%a!i&it" of the Taxin% Po#er or the Situs of Taxation of the Go$ernent fro taxes Coit"
!. or those express&" found in the constitution or ip&ied fro its pro$ision ' no exaction, copensation paid !" the %o$ernent
' direct !enefit resu&ts in the for of )ust copensation
6. process of &a# 1. protection of &a# @. 5reedo of and of the press =. of re&i%ious freedo . of contracts 4. for de!t or non'pa"ent of po&& tax 7. 9ri%in of , Re$enue and Tariff i&&s 2. , EBuita!i&it" and Pro%ressiti$it" of Taxation 3. of Le%is&ati$e Authorit" to 5x Tariff Rates, Iport and Export Fuotas 6. Tax Exeption of Actua&&", Direct&", and Exc&usi$e&" used for Re&i%ious Charita!&e 66. otin% reBuireents in connection #ith the Le%is&ati$e of Tax Exeption 61. Non'ipairent of the Supree )urisdiction in Tax Cases 6
TAXATION: San Beda College of LAW – ALABANG 6@. Tax exeption of and Assets, inc&udin% Grants, Endo#ents, Donations or Contri!utions to Education Institutions c. 6. and Tit&e of i&&s 1. Po#er of the to eto an ites in an Appropriation, Re$enue or Tariff i&& @. Necessit" of an ade !efore one" =. of Pu!&ic ?one" . Taxes Le$ied for Purposes 4. A&&otent to
A. a. If taxation is for a pu!&ic purpose, the tax ust !e used: a.68 for the support of the state or a.18 for soe reco%ni+ed o!)ects of %o$ernents or a.@8 direct&" to proote the #e&fare of the counit" 0taxation as an ip&eent of po&ice po#er8 The ter *pu!&ic purpose/ is s"non"ous #ith *%o$ernenta& purpose/ a purpose affectin% the inha!itants of the state or taxin% district as a counit" and not ere&" as indi$idua&s. b.
c. A tax &e$ied for a pri$ate purpose constitutes a ta(in% of propert" #ithout due process of &a#. d. The purposes to !e accop&ished !" taxation need not !e exc&usi$e&" pu!&ic. A&thou%h pri$ate indi$idua&s are direct&" !enefited, the tax #ou&d sti&& !e $a&id pro$ided such !enefit is on&" incidenta&. e. The test is not as to #ho recei$es the one", !ut the character of the purpose for #hich it is expended not the iediate resu&t of the expenditure !ut rather the u&tiate. %. In the iposition of taxes, pu!&ic purpose is presued.
!. tax &a#s shou&d !e capa!&e of con$enient, )ust and effecti$e adinistration. c. the tax !urden shou&d !e in proportion to the taxpa"ers a!i&it" to pa" 0a!i&it"'to'pa" princip&e8 . The 6327 Constitution reBuires taxation to !e eBuita!&e and unifor.
. 6.
Doctrine of Separation of Po#ers Taxation is pure&" &e%is&ati$e, Con%ress cannot de&e%ate the po#er to others.
a. De&e%ation to the President 0Art.I. Sec. 12018 6327 Constitution8 The po#er %ranted to Con%ress under this constitutiona& pro$ision to authori+e the President to fix #ithin specified &iits and su!)ect to such &iitations and restrictions as it a" ipose, tariff rates and other duties and iposts inc&ude tariffs rates e$en for re$enue purposes on&". Custos duties #hich are assessed at the prescri!ed tariff rates are $er" uch &i(e taxes #hich are freBuent&" iposed for !oth re$enue'raisin% and re%u&ator" purposes 0Garcia $s Executi$e Secretar", et. a&., G.R. No. 6617@, u&" @, 63318 !. De&e%ations to the Loca& Go$ernent 0Art. O. Sec. , 6327 Constitution8 It has !een he&d that the %enera& princip&e a%ainst the de&e%ation of &e%is&ati$e po#ers as a conseBuence of the theor" of separation of po#ers is su!)ect to one #e&&'esta!&ished exception, nae&", that &e%is&ati$e po#er a" !e de&e%ated to &oca& %o$ernents. The theor" of non'de&e%ation of &e%is&ati$e po#ers does not app&" in aters of &oca& concern. 0Pepsi'Co&a ott&in% Co. of the Phi&, Inc. $s Cit" of utuan, et . a&., L'1126=, Au%. 12, 63428 c. De&e%ation to Adinistrati$e A%encies #ith respect to aspects of Taxation not &e%is&ati$e in character. exap&e: assessent and co&&ection
1. a. #hether the thin% to !e threatened !" the appropriation of pu!&ic re$enue is soethin% #hich is the dut" of the State, as a %o$ernent. !. #hether the &a# pro$idin% the tax direct&" prootes the #e&fare of the counit" in eBua& easure.
a. the sources of tax re$enue shou&d coincide #ith, and approxiate the needs of %o$ernent expenditure. Neither an excess nor a deficienc" of re$enue $is'K'$is the needs of %o$ernent #ou&d !e in (eepin% #ith the princip&e.
a. It sha&& not contra$ene an" Constitutiona& pro$isions or inherent &iitations of taxation !. The de&e%ation is effected either !" the Constitution or !" $a&id&" enacted &e%is&ati$e easures or statute and c. The de&e%ated &e$" po#er, except #hen the de&e%ation is !" an express pro$ision of Constitution itse&f, shou&d on&" !e in fa$or of the &oca& &e%is&ati$e !od" of the &oca& or unicipa& %o$ernent concerned. =. E$er" s"ste of taxation consists of t#o parts: a. the e&eents that enter into the iposition of the tax ;S 1 A P A ?a $s 9r!os, et a&., G.R. No. 33224, ?ar. @6, 633@8
of taxation of persona&t" in the p&ace #here it has its actua& situs and the reBuisite &e%is&ati$e )urisdiction exists. shares of stoc( a" ha$e situs for purposes of taxation in a state in #hich the" are peranent&" (ept re%ard&ess of the doici&e of the o#ner, or the state in #hich he corporation is or%ani+ed.
If no constitutiona& pro$isions are $io&ated, the po#er of the &e%is&ati$e to fix situs is undou!ted. our &a# fixes the situs of intan%i!&e persona& propert" for purposes of the estate and %ift taxes. 0see 8 In those cases #here the situs for certain intan%i!&es are not cate%orica&&" spe&&ed out, there is roo for app&"in% the o!i&ia ru&e. =.
0see &ater topic8
4.
*Loca& Go$ernent units sha&& ha$e a )ust share, as deterined !" &a#, in the nationa& taxes #hich sha&& !e autoatica&&" re&eased to the./
a. Po&& tax a" !e &e$ied upon persons #ho are residents of the State. !. is su!)ect to taxation in the State in #hich it is &ocated #hether the o#ner is a resident or non'resident, and is taxa!&e on&" there.
c. taxa!&e in the state #here it has actua& situs #here it is ph"sica&&" &ocated. A&thou%h the o#ner resides in another )urisdiction.
6. &itera&&" eans the 1. state #here the su!)ect to !e taxed has a situs a" ri%htfu&&" &e$" and co&&ect the tax
A &e%a& situs cannot !e %i$en to propert" for the purpose of taxation #here neither the propert" nor the person is #ithin the protection of the taxin% state In the case of ?ani&a E&ectric Co. $s atco 043 Phi& 238 , the Supree Court ru&ed that insurance preiu paid on a fire insurance po&ic" co$erin% propert" situated in the Phi&s. are taxa!&e in the Phi&s. E$en thou%h the fire insurance contract #as executed outside the Phi&s. and the insurance po&ic" is de&i$ered to the insured therein. This is !ecause the Phi&ippines Go$ernent ust %et soethin% in return for the protection it %i$es to the insured propert" in the Phi&s. and !" reason of such protection, the insurer is !enefited there!".
d. situs or persona& propert" is the doici&e of the o#ner, in accordance #ith the princip&e , said princip&e, ho#e$er, is not contro&&in% #hen it is inconsistent #ith express pro$isions of statute or #hen )ustice deands that it shou&d !e, as #here the propert" has in fact a situs e&se#here. 0see e&&s 5ar%o an( $. Co&&ector 7 P-IL @1 Co&&ector $. 5isher L'66411, anuar", 63468 e. proper&" exacted fro persons #ho are residents or citi+ens in the taxin% )urisdiction and e$en those #ho are neither residents nor citi+ens pro$ided the incoe is deri$ed fro sources #ithin the taxin% state. f. po#er to &e$" an excise tax depends upon the p&ace #here the !usiness is done, of the occupation is en%a%ed in of the transaction not p&ace.
1. Accordin% to this axi, #hich eans /o$a!&e fo&&o# the person,/ the situs of persona& propert" is the doici&e of the o#ner. This is ere&" a fiction of &a# and is not a&&o#ed to stand in the #a"
%. transission of propert" fro donor to donee, or fro a decedent to his heirs a" !e su!)ect to taxation in the state #here the transferor #as a citi+en or resident, or #here the propert" is &ocated. 11
TAXATION: San Beda College of LAW – ALABANG 1. an aount su!tracted fro an indi$idua&s or entit"s tax &ia!i&it" to arri$e at the tota& tax &ia!i&it" There is u&tip&icit" of situs #hen the sae su!)ect of taxation, &i(e incoe or intan%i!&e, is su!)ect to taxation in se$era& taxin% )urisdictions. This happens due to: a. ariance in the concept of *doici&e/ for tax purposes !. ?u&tip&e distinct re&ationship that a" arise #ith respect to intan%i!&e persona&it" and c. The use to #hich the propert" a" ha$e !een de$oted, a&& of #hich a" recei$e the protection of the &a#s of )urisdiction other than the doici&e of the o#ner taxation )urisdiction a" pro$ide: a. Exeption or a&&o#ance of deductions or tax credit for forei%n taxes !. Enter into treaties #ith other states
6. 0Dou!&e taxation in its strict sense8 ' In the o!)ectiona!&e or prohi!ited sense eans that the sae propert" is taxed t#ice #hen it shou&d !e taxed on&" once.
6. 1. @. =. . 4.
Sae propert" is taxed t#ice Sae purpose Sae taxin% authorit" ithin the sae )urisdiction Durin% the sae taxin% period Sae (ind or character of tax
1. 0Dou!&e taxation in its !road sense8 This is the opposite of direct dou!&e taxation and is not &e%a&&" o!)ectiona!&e. The a!sence of one or ore of the fore%oin% reBuisites of the o!noxious direct tax a(es it indirect.
A deduction differ fro a tax credit in that a deduction reduces taxa!&e incoe #hi&e credit reduces tax &ia!i&it"
@. =. .
#ith other States
Dou!&e Taxation in its stricter sense is undou!ted&" unconstitutiona& !ut that in the !roader sense is not necessari&" so. 9ur Constitution does not prohi!it dou!&e taxation hence, it a" not !e in$o(ed as a defense a%ainst the $a&idit" of tax &a#s. a. here a tax is iposed !" the Nationa& Go$ernent and another !" the cit" for the exercise of occupation or !usiness as the taxes are not iposed !" the sae pu!&ic authorit" 0 Cit" of a%uio $s De Leon, 9ct. @6, 63428 !. hen a Rea& Estate dea&ers tax is iposed for en%a%in% in the !usiness of &easin% rea& estate in addition to Rea& Estate Tax on the propert" &eased and the tax on the incoe desired as the" are different (inds of tax c. Tax on anufacturers products and another tax on the pri$i&e%e of storin% exporta!&e copra in #arehouses #ithin a unicipa&it" are iposed as first tax is different fro the second d. here, aside fro the tax, a &icense fee is iposed in the exercise of po&ice po#er. Dou!&e Taxation #hi&e not for!idden, is soethin% not fa$ored. Such taxation, it has !een he&d, shou&d, #hene$er possi!&e, !e a$oided and pre$ented. a. Dou!ts as to #hether dou!&e taxation has !een iposed shou&d !e reso&$ed in fa$or of the taxpa"er. The reason is to a$oid in)ustice and unfairness. !. The taxpa"er a" see( re&ief under the niforit" Ru&e or the EBua& Protection %uarantee.
1.
6. A tax on the ort%a%e as persona& propert" #hen the ort%a%ed propert" is a&so taxed at its fu&& $a&ue as rea& estate 1. A tax upon a corporation for its capita& stoc( as a #ho&e and upon the shareho&ders for their shares @. A tax upon a corporation for its capita& stoc( as a #ho&e and upon the shareho&ders for their shares =. A tax upon depositions in the !an( for their deposits and a tax upon the !an( for their propert" in #hich such deposits are in$ested . An excise tax upon certain use of propert" and a propert" tax upon the sae propert" and 4. A tax upon the sae propert" iposed !" t#o different states.
2. 3. 4. 5. 6.
hiftin% apita&i+ation ransforation $asion $oidance xeption
6. Transfer of the !urden of a tax !" the ori%ina& pa"er or the one on #ho the tax #as assessed or iposed to another or soeone e&se is the point at #hich a tax is ori%ina&&" iposed. is the point on #hich a tax !urden fina&&" rests or sett&es do#n.
6. taxa!&e incoe
su!traction fro %ross incoe in arri$in% a
the ipact is the initia& phenoenon, the shiftin% is the interediate process, and the incidence is the resu&t. 12
TAXATION: San Beda College of LAW – ALABANG
a. the !urden of tax is transferred fro a factor of production throu%h the factors of distri!ution unti& it fina&&" sett&es on the u&tiate purchaser or consuer !. effected #hen the !urden of tax is transferred fro the consuer or purchaser throu%h the factors of distri!ution to the factor of production c. this occurs #hen the tax is shifted t#o or ore ties either for#ard or !ac(#ard
6. It is ere&" a persona& pri$i&e%e of the %rantee 1. It is %enera&&" re$oca!&e !" the %o$ernent un&ess the exeption is founded on a contract #hich is protected fro ipairent, !ut the contract ust contain the other essentia& e&eents of contracts, such as, for exap&e, a $a&id cause or consideration. @. It ip&ies a #ai$er on the part of the %o$ernent of its ri%ht to co&&ect #hat other#ise #ou&d !e due to it, and in this sense is pre)udicia& thereto. =. It is not necessari&" discriinator" so &on% as the exeption has a reasona!&e foundation or rationa& !asis.
1. defined the reduction in the price of the taxed o!)ect eBua& to the capita&i+ed $a&ue of future taxes #hich the purchaser expects to !e ca&&ed upon to pa"
C.
@. The ethod #here!" the anufacturer or producer upon #ho the tax has !een iposed, fearin% the &oss of his ar(et if he shou&d add the tax to the price, pa"s the tax and endea$ors to recoup hise&f !" ipro$in% his process of production there!" turnin% out his units of products at a &o#er cost. =. is the use of the taxpa"er of i&&e%a& or fraudu&ent eans to defeat or &essen the pa"ent of a tax.
a. 5ai&ure to dec&are for taxation purposes true and actua& incoe deri$ed fro !usiness for t#o consecuti$e "ears, and b. Su!stantia& underdec&aration of incoe tax returns of the taxpa"er for four consecuti$e "ears coup&ed #ith o$erstateent of deduction. E$asion of the tax ta(es p&ace on&" #hen there are no proceeds. E$asion of Taxation is tantaount, fisca&&" spea(in%, to the a!sence of taxation.
. is the use !" the taxpa"er of &e%a&&" perissi!&e a&ternati$e tax rates or ethod of assessin% taxa!&e propert" or incoe in order to a$oid or reduce tax &ia!i&it". Tax A$oidance is not punisha!&e !" &a#, a taxpa"er has the &e%a& ri%ht to decrease the aount of #hat other#ise #ou&d !e his taxes or a&to%ether a$oid !" eans #hich the &a# perits.
Pu!&ic interest #ou&d !e su!ser$ed !" the exeption a&&o#ed #hich the &a#'a(in% !od" considers sufficient to offset onetar" &oss entai&ed in the %rant of the exeption. 0CIR $s othe&o Shippin% Corp., L'164@@, une 13, 6347 CIR $s PAL, L'134, 9ct. @6, 63428 D. 6. ?a" !e !ased on a contract in #hich case, the pu!&ic represented !" the Go$ernent is supposed to recei$e a fu&& eBui$a&ent therefore 1. ?a" !e !ased on soe %round of pu!&ic po&ic", such as, for exap&e, to encoura%e ne# and necessar" industries. @. ?a" !e created in a treat" on %rounds of reciprocit" or to &essen the ri%ors of internationa& dou!&e or u&tip&e taxation #hich occur #here there are an" taxin% )urisdictions, as in the taxation of incoe and intan%i!&e persona& propert" E. There is no tax exeption so&e&" on the %round of eBuit", !ut eBuit" can !e used as a !asis for statutor" exeption. At ties the &a# authori+es condonation of taxes on eBuita!&e considerations. 0Sec 174, 177, Loca& Go$ernent Code8 5. 6.
As to
a. #hich ori%inate fro the Constitution !. Le%is&ation
Iunities fro taxation Those #hich eanate fro
1.
accop&ished !" !rea(in% the &etter of the &a#
accop&ished !" &e%a& procedures or eans #hich a"!e contrar" to the intent of the sponsors of the tax &a# !ut ne$erthe&ess do not $io&ate the &etter of the &a#
A. is a %rant of iunit", express or ip&ied, to particu&ar persons or corporations fro the o!&i%ations to pa" taxes. .
As to a. hene$er express&" %ranted !" or%anic or statute of &a# !. Exist #hene$er particu&ar persons, properties or excises are deeed exept as the" fa&& outside the scope of the taxin% pro$ision itse&f @.
As to
a. !. tax is dispensed #ith
Connotes a!so&ute iunit" 9ne #here co&&ection of a part of the
G. 6. Exeptions fro taxation are hi%h&" disfa$ored !" &a#, and he #ho c&ais an exeption ust !e a!&e to )ustif" !" the c&earest %rant of or%anic or statute of &a#. 0Asiatic Petro&eu $s L&anes, =3 13
TAXATION: San Beda College of LAW – ALABANG P-IL =44 Co&&ector of Interna& Re$enue $s. ?ani&a oc(e" C&u!, 32 P-IL 478 1. -e #ho c&ais an exeption ust )ustif" that the &e%is&ati$e intended to exept hi !" #ords too p&ain to !e ista(en. 0isa"an Ce!u Terina& $s CIR, L'63@, 5e!. 17, 6348 @. -e #ho c&ais exeptions shou&d con$incin%&" pro$ed that he is exept =. Tax exeptions ust !e strict&" construed 0Phi&. Acet"&ene $s CIR, L'6377, Au%. 67, 63478 . Tax Exeptions are not presued. 0Lea&da E&ectric Co. $s CIR, L'64=12, Apr. @, 634@8 4. Constitutiona& %rants of tax exeptions are se&f'executin% 09pinion No. 6@, 6327, Sec. 9f ustice8 7. Tax exeption are persona&. 2. Deductions for incoe tax purposes parta(e of the nature of tax exeptions, hence, the" are strict&" construed a%ainst the tax pa"er 3. A tax anest", uch &i(e a tax exeption is ne$er fa$ored or presued !" &a# 0CIR $s CA, G.R. No. 6274, an. 1, 63338 6. The ru&e of strict construction of tax exeption shou&d not !e app&ied to or%ani+ations perforin% strict&" re&i%ious, charita!&e, and educationa& functions
It pro$ides that a c&ai for refund !arred !" prescription a" !e a&&o#ed to offset unsett&ed tax &ia!i&ities shou&d !e pertinent on&" to taxes arisin% fro the sae transaction on #hich an o$erpa"ent is ade and underpa"ent is due. This doctrine, ho#e$er, #as re)ected !" the Supree Court, sa"in% that it #as not con$inced of the #isdo and proprietar" thereof, and that it a" #or( to tept !oth the co&&ectin% a%enc" and the taxpa"er to de&a" and ne%&ect their respecti$e pursuits of &e%a& action #ithin the period set !" &a#. 0Co&&ector $s ST, 6= P-IL 6418 It is on&" #hen an act cop&ained of, #hich a" inc&ude &e%is&ati$e enactent, direct&" in$o&$es the i&&e%a& dis!urseent of pu!&ic funds deri$ed fro taxation that the taxpa"ers suit a" !e a&&o#ed.
6. 9n the interpretation and construction of tax statutes, &e%is&ati$e intention ust !e considered. 1. In case of dou!t, tax statutes are construed strict&" a%ainst the %o$ernent and &i!era&&" construed in fa$or of the taxpa"er.
Taxes ust on&" !e iposed prospecti$e&" The &an%ua%e of the statute c&ear&" deands or express that it sha&& ha$e a retroacti$e effect .
6. In order to dec&are a tax trans%ressin% the due process c&ause of the Constitution it ust !e so harsh and oppressi$e in its retroacti$e app&ication 05ernande+ $s 5ernande+, 33 P-IL3@=8 1. Tax &a#s are neither po&itica& nor pena& in nature the" are deeed &a#s of the occupied territor" rather than the occup"in% ene". 0-i&ado $s Co&&ector, 6 P-IL 1228 @. Tax &a#s not !ein% pena& in character, the ru&e in the Constitution a%ainst the passa%e of the ex post facto &a#s cannot !e in$o(ed, for the pena&t" iposed.
Taxes are iprescripti!&e
@. The ru&e of strict construction a%ainst the %o$ernent is not app&ica!&e #here the &an%ua%e of the tax &a# is p&ain and there is no dou!t as to the &e%is&ati$e intent. =. The exeptions 0or eBui$a&ent pro$isions, such as tax anest" and tax condonation8 are not presued and #hen %ranted are strict&" construed a%ainst the %rantee. . The exeptions, ho#e$er, are construed &i!era&&" in fa$or of the %rantee in the fo&&o#in%: a. hen the &a# so pro$ides for such &i!era& construction !. Exeptions fro certain taxes %ranted under specia& circustances to specia& c&asses of persons c. Exeptions in fa$or of the Go$ernent, its po&itica& su!di$isions d. Exeptions to traditiona& exeptees, such as, those in fa$or of charita!&e institutions. 4.
The tax &a#s are presued $a&id.
7.
The po#er to tax is presued to exist.
hen pro$ided other#ise !" the tax &a# itse&f. Exap&e: NIRC pro$ides for statutes of &iitation in the assessent and co&&ection of taxes therein iposed
6. The &a# on prescription, !ein% a reedia& easure, shou&d !e &i!era&&" construed to afford protection as a coro&&ar", the exceptions to the &a# on prescription !e strict&" construed. 0CIR $s CA. G.R. No. 6=676, 5e!. 1=, 63338
14
TAXATION: San Beda College of LAW – ALABANG
6.
1.
ureau of Interna& Re$enue and the ureau of Custos for interna& re$enue and custos &a# enforceent. It is note#orth" to note that the IR is &ar%e&" decentra&i+ed in that a %reat extent of tax enforceent duties are de&e%ated to the Re%iona& Directors and Re$enue District 9fficers. Pro$incia&, Cit" and ?unicipa& assessors and treasures for &oca& and rea& propert" taxes.
It is a sett&ed ru&e of &a# that in the perforance of its %o$ernenta& functions, the state cannot !e estopped !" the ne%&ect of its a%ents and officers. No#here is it ore true than in the fie&d of taxation 0CIR $s . A!ad, et. a&., L'63417, une 17, 6342 8. Estoppe& does not app&" to prec&ude the su!seBuent findin%s on taxa!i&it" 0I!id.8 The princip&e of tax &a# enforceent is:
0E. Rodri%ue+, Inc. $s. Co&&ector of Interna& Re$enue, L' 1@=6, u&" @6, 6343.8 Sii&ar&", estoppe& does not app&" to depri$e the %o$ernent of its ri%ht to raise defenses e$en if those defenses are !ein% raised on&" for the first tie on appea& 0CIR $s Procter Ga!&e Phi&. G.R. No. 442@2, 6 Apri& 6322.8
nder Sec. 61 of the 6337 NIRC, the fo&&o#in% are constituted as a%ents of the Coissioner: a.
!.
c.
The Coissioner of Custos and his su!ordinates #ith respect to the co&&ection of nationa& interna& re$enue taxes on iported %oods The head of the appropriate %o$ernent office and his su!ordinates #ith respect to the co&&ection of ener%" tax and an(s du&" accredited !" the Coissioner #ith respect to receipt of pa"ents of interna& re$enue taxes authori+ed to !e ade throu%h !an(s.
a.
!. c. d. e. f.
Exc&usi$e and ori%ina& po#er to interpret pro$isions of the NIRC and other tax &a#s, su!)ect to re$ie# !" the Secretar" of 5inance Assessent and Co&&ection of a&& nationa& interna& re$enue taxes, fees and char%es Enforceent of a&& forfeitures, pena&ties and fines connected there#ith Execution of )ud%ent in a&& cases decided in its fa$or !" the Court of Tax Appea&s and the ordinar" courts. Effectin% and adinisterin% the super$isor" and po&ice po#ers conferred to it !" the Tax Code or other &a#s. 9!tainin% inforation, suonin%, exainin% and ta(in% testion" of persons for purposes of ascertainin% the correctness of an" return or in deterinin% the &ia!i&it" of an" person for an" interna& re$enue tax, or in co&&ectin% an" such &ia!i&it".
The Court ru&ed in Coissioner of Interna& Re$enue $s. C.A., et. a&. G.R. No. 667321, 4 5e! 6337 that &i(e other princip&es of &a#, the non'app&ication of estoppe& to the %o$ernent
hi&e the princip&e of estoppe& a" not !e in$o(ed a%ainst the %o$ernent, this is not necessari&" true in case of the taxpa"er. In CIR $s. Su"ac, 6= Phi& 263 , the taxpa"er ade se$era& reBuests for the rein$esti%ation of its tax &ia!i&ities such that the %o$ernent, accedin% to the taxpa"ers reBuest, postponed the co&&ection of its &ia!i&it". The taxpa"er cannot &ater on !e peritted to raise the defense of prescription inasuch as his pre$ious reBuests for rein$esti%ation ha$e the effect of p&acin% hi in estoppe&.
0isa"a Land Transportation Co. $s CIR, 6 Phi& 6@@28
Tax is assessed !" the taxpa"er hise&f. The aount is ref&ected in the tax return that is fi&ed !" hi and the tax is paid at the tie he fi&es his return. 0Sec. 4 ;A< 6
View more...
Comments
