BATANGAS STATE UNIVERSITY

College of Accountancy, Business, Economics

& International Hospitality Management
Gov. Pablo Borbon Campus I, Batangas City, Philippines 4200
www.bat-state.edu.ph Telefax: (043) 300-2202 loc 226

Name: Bagui, Edward Glenn L. Course and Section: BSA – 3103 SR Code: 18-56350

General Direction: Select the correct answer.

1. Which statement is wrong?

a. The power of taxation may be exercised by the government, its political subdivisions and public
utilities.
b. Generally, there is no limit on the amount of tax that may be imposed
c. The money contributed as tax becomes part of public funds.
d. The power to tax is subject to inherent and constitutional limitations.

2. The strongest of all inherent powers of the government is

a. Power of taxation
b. Police power
c. Power of eminent domain
d. Power of recall

3. The power to regulate liberty and property to promote the general welfare
a. Power of taxation
b. Police power
c. Power of eminent domain
d. Power of recall

4. Which of the following requires public improvement?

I. Taxation
II. Police Power
III. Eminent Domain
a. I only
b. I and III only
c. III only
d. II and III only

5. The following are similarities among the Fundamental Powers of the state, except:
a. They can be abolished by the Constitution
b. They constitute the three methods by which the State interferes with private property rights
c. Each presupposes an equivalent compensation to the inhabitants
d. The emergence of the State carries with it these fundamental powers

6. The following are the differences between the Power of Taxation and the Power of Eminent Domain, except:
Power of Taxation Power of Eminent Domain
a. Enforced proportionate contribution Property to be taken is for public use
b. Government has no obligation to pay Government is a debtor of the property taken
c. It operates in a community it operates on an individual
d. Attribute of sovereignty fundamental power

7. Which of the following taxes is always proportional?

a. Value added tax
b. Income tax
c. Estate tax
d. Donor’s tax

8. Tax which is demanded from one person in the expectation and intention that he shall indemnify himself at the
expense of another
a. Direct
b. Indirect
c. Excise
d. Income

9. The least source of tax laws among the following:

a. Statutes
b. Presidential decrees
 BATANGAS STATE UNIVERSITY
College of Accountancy, Business, Economics
& International Hospitality Management
Gov. Pablo Borbon Campus I, Batangas City, Philippines 4200
www.bat-state.edu.ph Telefax: (043) 300-2202 loc 226

Name: Bagui, Edward Glenn L. Course and Section: BSA – 3103 SR Code: 18-56350
c. Revenue regulations
d. Tax treaties or conventions

10. A fundamental rule in taxation is that “the property of one country may not be taxed by another country”. This
is known as
a. International law
b. Reciprocity
c. International comity
d. International inhibition

11. May the Philippine Government require tax withholding on the salaries of Filipino employees working in the
American Embassy in the Philippines?
a. No, because this will violate the rule of international comity.
b. No, because if the Philippine government would impose the requirement of tax withholding on the
salaries of Filipino employees working in the Philippine Embassy in the Philippines, this would in
effect require that the American government be constituted as the withholding agent of the Philippine
government insofar as the taxes on the salaries of the Filipino employees are concerned.
c. Both A and B
d. None of the above

12. The 30% corporate income tax is increased to 35% by the Congress for the purpose of raising revenue to be
used for national road expansion project near Bonifacio Global City, a private corporation. Is the exercised of
taxing power unconstitutional?
a. Yes, because taxing power must be exercised exclusively for public purpose without any incidental
benefits to any private entity
b. No, because it is not exercised directly for public purpose and to the benefit to a private entity is only
incidental.
c. Yes, because the increase in tax rate constitutes deprivation of right to property of corporation without
due process of law for being excessive and unreasonable
d. No, because the constitution does not expressly state that the power of taxation must be used only for
public purpose, thus, it may be used to benefit a private entity.

13. One of the following is not a characteristic or an element of tax

a. It is levied by the legislature
b. It is payable in money or in kind
c. It is proportionate in character
d. It is an enforced contribution

14. The following constitutes double taxation, except one

a. Both taxes are imposed in the same amount
b. Both taxes are levied for the same purpose
c. Both taxes are imposed by the same taxing authority
d. Both taxes are imposed upon the same person

15. The existence of the government is a necessity and that the state has the right to compel all individuals and
property within its limits to contribute
a. Basis of taxation
b. Situs of taxation
c. Scope of taxation
d. Theory of taxation

16. Which of the following statements is correct?

I. Taxes are pecuniary in nature
II. It co-exist with the existence of the State
III. Imposed on persons and property beyond the territorial jurisdiction of the State
a. I only
b. II only
c. I and II only
 BATANGAS STATE UNIVERSITY
College of Accountancy, Business, Economics
& International Hospitality Management
Gov. Pablo Borbon Campus I, Batangas City, Philippines 4200
www.bat-state.edu.ph Telefax: (043) 300-2202 loc 226

Name: Bagui, Edward Glenn L. Course and Section: BSA – 3103 SR Code: 18-56350
d. I, II and III

17. Which of the following may not raise money for the government?
a. Power of taxation
b. Police power
c. Power of eminent domain
d. Privatization of government’s capital assets

18. Under this basic principle of a sound taxation system, the tax law must be capable of convenient, just and
effective administration.
a. Theoretical justice
b. Fiscal adequacy
c. Administrative feasibility
d. Rule of appointment

19. These are restrictions imposed by the Constitution

a. Inherent limitations
b. Constitutional limitations
c. Basic principles of sound tax system
d. None of the choices

20. Compliance with procedural requirements must be followed strictly to avoid collision between the State’s
power to tax and the individual’s recognized rights.
a. Due process of law
b. Equality in taxation
c. Non-infringement of religious freedom
d. Non-impairment of obligations and contracts

21. This requires that all subjects or objects of taxation, similarly situated are to be treated alike or put on equal
footing both in privileges and liabilities
a. Due process
b. Uniformity
c. Progressive taxation
d. None of the above

22. The Philippine income tax system has the following features, except
a. Comprehensive tax situs by using the nationality, residence and source rules
b. The individual income tax system is mainly progressive in nature
c. Indirect rather than direct system
d. Semi-global and semi-schedular system

23. Toll as distinguished from tax

a. Demand of sovereignty
b. Imposed by government only
c. Amount is based on the cost of construction of public improvement used
d. Paid for the support of the government

24. In case of ambiguity, tax laws imposing a tax shall be interpreted

a. Strictly against the taxpayer
b. Liberally in favor of the taxpayer
c. Liberally in favor of the government
d. None of the above

25. Which of the following statements is correct?

I. Shifting will result in increase prices
II. Tax evasion is also known as tax dodging
a. I only
b. II only
c. I and II
d. Neither I nor II