AE 26 INCOME TAXATION

• Taxation : power by which the sovereign raises revenue to defray the necessary expenses of the government.
• Taxation : Is merely away of aportioning the cost of government among those who are privilege to enjoy the benefits and bear its burden.
• without taxes, the government would be paralyzed for lack of power to activate and operate it.
• rationale of taxation : symbiotic relationship
• Revenue : A tax is imposed under the taxing power of the government
• Revenue : principally for the purpose of raising revenues to fund public expenditures
• Non-revenue/ Sumptuary purposes

  • Promotion of general welfare
  • Protectionism
  • Regulation
  • Reduction of Social inequality
  • Encourage economic growth
• Promotion of general welfare : taxing power maybe used as n implement of police power
• Regulation : Taxes may be levied with regulatory purpose to provide means for rehabilitation and stabilization of a threatened industry which is affected with public interest as to be within the police power of the state.
• Reduction to Social Inequality : This is made possible through the progressive system of taxation where the objective is to prevent the undue concentration of wealth in the hands of a few individuals.
• Progressivity : Is based on the principle that those who are able to pay should shoulder bigger portion of the tax burden
• Progressivity is also known as : compensatory purpose
• Encourage economic growth : in the realm of tax reliefs, the purpose if to grant incentives or exceptions in order to encourage investment s and thereby promote the country's economic growth.
• Protectionism : In case of foreign importations, protective tariffs and customs are imposed for the benefit of local industries
• Toll fee : Sum of money for the use of something, a consideration which is paid for the use of property which is of a public nature
• Toll fee, as to basis, is a demand of proprietorship
• Tax, as a basis is a demand of sovereignity
• tax, as to amount has no limit
• Toll fee as to amount depends upon the cost of construction or maintenance of the public improvement
• Tax as to authority may be imposed only by the government
• Toll fee, as to authority may be impose imposedd by the :

  
  

  • Government
  • private individuals
• Tax as to purpose is imposed for revenue purposes
• License fee as to purpose is imposed for regulatory purposes
• Tax as to basis is imposed under the power of taxation
• License fee as to basis is imposed under the police power of the government
• License fee as to amount is limited ti the cost Issuance of license, inspection and suveillance
• Tax as to time of payment is normally paid after the start of the business
• Does failure to pay tax make the business illegal?

  False
• Does failure to pay license fee makes the business illegal?

  TRUE
• Tax as to nature, being the lifeblood of the State, cannot be surrendered except for lawful consideration?

  TRUE
• License as to nature may be with or without consideration?

  TRUE
• Penalty : Sanction imposed as punishment for violation of a law or acts deemed injurious
• violation of tax law may give rise to imposition of : penalty
• Penalty as to authority may be imposed by the :

  • Government
  • Private Individuals
• Special assesment : Enforced proportional contributions from owners if lands especially or peculiarly benefited by public improvements
• Tax as to subject, are levied on:

  • Land
  • Persons
  • Property
  • Income
  • Business
• Special assessment as to subject are levied on Land
• Tax as to liability are personal liability of the taxpayer
• Special assesment as to liability cannot be made liability of the person assessed
• tax as to basis is based ib necessity and partially on benefits