Taxation

• Fundamental: matter of survival for the government
• The purpose is to raise revenue for public needs so that people may be enabled to live in a civilized society
• Fiscal policy influences direction and structure of money supply, prices, and national economy
• Fiscal adequacy is where the source of revenue as a whole must be sufficient
• Equality/ Theoretical justice is based on the taxpayer's ability to pay
• Administrative feasibility is the tax systems where it must be clear to taxpayers
• Eminent Domain where it expropriate private property for public use upon payment of a just compensation
• Direct tax is the one who absorbs tax or bears it
• Ad valorem tax is a fixed proportion
• Progressive tax is where the tax rate increases as the tax base increases
• Regressive tax is where the effective rate decreases as the base increases
• Proportional tax is a fixed percentage
• Capitalization is one of the special forms of backward shifting in forms of escape
• Evasion is an illegal effort in forms of escape
• Avoidance is legally permissible in forms of escape
• Local Taxations is valid for public purpose
• Article VI, Section 28 in the constitution states that the rule of taxation shall be uniform and equitable and congress shall have progressive system of taxation
• The National Internal Revenue Code (NIRC) is the primary source of law on income taxes.
• For national level, it is collected by BIR