CHAPTER 1

GENERAL PRINCIPLES
AND CONCEPTS OF
TAXATION
INHERENT POWERS OF THE
STATE
▪ ESSENTIAL POWER NECESSARY FOR THE
SOVEREIGN STATE’S SURVIVAL.

▪ EXIST AS THE CENTRAL FORCE IN ORDER

THAT A GOVERNMENT CAN:
✔ COMMAND
 ✔ MAINTAIN PEACE AND ORDER,
✔ SURVIVE IRRESPECTIVE OF ANY
CONSTITUTIONAL PROVISION.

CHAPTER 1 General Principles and Concepts of Taxation

THREE INHERENT POWERS OF THE

SOVEREIGN STATE
•POLICE POWER
THE POWER TO PROTECT CITIZENS AND PROVIDE
SAFETY AND WELFARE OF SOCIETY.
• EMINENT DOMAIN POWER
THE POWER TO TAKE PRIVATE PROPERTY (WITH
JUST COMPENSATION) FOR PUBLIC USE.

• TAXATION POWER
THE POWER TO ENFORCE CONTRIBUTIONS TO
SUPPORT THE GOVERNMENT, AND OTHER INHERENT
POWERS OF THE STATE.CHAPTER 1 General Principles and Concepts of Taxation
TAXATION DEFINED

1. A POWER BY WHICH AN INDEPENDENT STATE,

 THROUGH ITS LAW MAKING BODY, RAISES
AND ACCUMULATES REVENUE FROM ITS
INHABITANTS TO PAY THE NECESSARY
EXPENSES OF THE GOVERNMENT.
2. A PROCESS OR ACT OF IMPOSING A CHARGE
BY GOVERNMENTAL AUTHORITY ON
PROPERTY, INDIVIDUALS OR TRANSACTIONS
TO RAISE MONEY FOR PUBLIC PURPOSES.

CHAPTER 1 General Principles and Concepts of Taxation

TAXATION DEFINED (CONT’D)

3. A MEANS BY WHICH THE SOVEREIGN
STATE THROUGH ITS LAW-MAKING BODY
DEMANDS FOR REVENUE IN ORDER TO
SUPPORT ITS EXISTENCE AND CARRY OUT
ITS LEGITIMATE OBJECTIVES.
 CHAPTER 1 General Principles and Concepts of Taxation

NATURE OF TAXATION POWER

• INHERENT POWER OF SOVEREIGNTY; •

ESSENTIALLY A LEGISLATIVE FUNCTION; •
FOR PUBLIC PURPOSES;
• TERRITORIAL IN OPERATION;
• TAX EXEMPTION OF GOVERNMENT;
• THE STRONGEST AMONG THE INHERENT
POWERS OF THE GOVERNMENT; AND
• SUBJECT TO CONSTITUTIONAL AND
INHERENT LIMITATIONS.
CHAPTER 1 General Principles and Concepts of Taxation

SCOPE OF TAXATION POWER

▪ IT REACHES EVERY TRADE OR

 OCCUPATION
▪ EVERY OBJECT OF INDUSTRY, AND
▪ EVERY SPECIES OF POSSESSION.

⮚ IT IMPOSES A BURDEN WHICH, IN CASE OF FAILURE TO

DISCHARGE, MAY BE FOLLOWED BY SEIZURE OR
CONFISCATION OF PROPERTY.

CHAPTER 1 General Principles and Concepts of Taxation

SUBJECT TO INHERENT AND

CONSTITUTIONAL
LIMITATIONS ▪ INHERENT POWER
✔ ITS VERY PURPOSE AND NATURE RESTRICT
TAXATION.
✔ TAX POWER SHOULD BE EXERCISED FOR
ITS VERY NATURE, PURPOSE AND
JURISDICTION.

⮚ A VIOLATION OF THESE INHERENT LIMITATIONS IS

TANTAMOUNT TO TAKING A PROPERTY WITHOUT DUE
PROCESS OF LAW.
 CHAPTER 1 General Principles and Concepts of Taxation

SUBJECT TO INHERENT AND

CONSTITUTIONAL LIMITATIONS
(CONT’D)

▪ CONSTITUTION
✔ TO PROTECT THE OBJECT OF
TAXATION AGAINST ITS ABUSIVE
IMPLEMENTATION.
 ⮚ IF A TAX LAW VIOLATES THE CONSTITUTION, SUCH LAW
SHALL BE DECLARED NULL AND VOID.

CHAPTER 1 General Principles and Concepts of Taxation

SIMILARITIES AMONG
TAXATION, EMINENT
DOMAIN AND POLICE
POWERS
1. THEY ARE INHERENT POWERS OF THE STATE;
2. THEY CONSTITUTE THE THREE WAYS BY WHICH THE STATE
INTERFERES WITH THE PRIVATE RIGHTS AND PROPERTY;
3. THEY ARE LEGISLATIVE IN NATURE AND CHARACTER; 4.
THEY PRESUPPOSE AN EQUIVALENT COMPENSATION;
5. THEY ALL UNDERLIE AND EXIST INDEPENDENTLY OF THE
CONSTITUTION;
6. THEY ARE ALL NECESSARY ATTRIBUTES OF SOVEREIGNTY;
AND
7. THE PROVISIONS IN THE CONSTITUTION ARE JUST
LIMITATIONS ON THE EXERCISE OF THESE POWERS.
CHAPTER 1 General Principles and Concepts of Taxation

DISTINCTION OF TAXATION,
POLICE POWER, AND
EMINENT DOMAIN
 TAXATION POLICE POWER EMINENT DOMAIN
1. AS TO CONCEPT POWER TOPOWER TO TAKE
ENFORCE PRIVATE
CONTRIBUPROPERTY FOR
TO RAISE PUBLIC USE WITH JUST
GOVERNMCOMPENSATION.
FUNDS.

2. AS TO SCOPE BROADER IN AND IMPLEMENT PRIVATE

PLENARY, APPLICATION, LAWS. PROPERTY FOR
COMPREHENSIVEGENERAL MERELY A PUBLIC USE.
AND SUPREME POWER TO MAKE POWER TO TAKE

CHAPTER 1 General Principles and Concepts of Taxation

DISTINCTION OF TAXATION,
 POLICE POWER, AND EMINENT
DOMAIN (CONT’D)
TAXATION POLICE POWER EMINENT DOMAIN
COMPANIES.
SUBDIVISIO
3. AS TO AUTHORITY
EXERCISED
ONLY BY MAY BE GRANTED TO
GOVERNM PUBLIC
OR ITS SERVICE OR
POLITICALPUBLIC UTILITY
4. AS TO GOVERNMENT. PROMOTE PROPERTY IS
PURPOSE PROPERTY IS GENERAL TAKEN FOR
MONEY IS TAKEN TAKEN OR WELFARE. PUBLIC USE.
TO SUPPORT THE DESTROYED TO PRIVATE
 CHAPTER 1 General Principles and Concepts of Taxation

DISTINCTION OF TAXATION,
POLICE POWER, AND
EMINENT DOMAIN (CONT’D)
TAXATION POLICE POWER EMINENT DOMAIN
5. AS TO THE POW
NECESSITY OF TO MAK
DELEGATION LAWS
CANNO
CAN BE
DELEGA
EXPRESSLY
DELEGATED TO THE
LOCAL
GOVERNMENT UNITS BY THE LAW MAKING BODY.
OPERATES ON A COMMUNITY OR PARTICULAR
6. AS TO COMMUNITY ORA CLASS OF PRIVATE
PERSON A CLASS OF INDIVIDUAL. PROPERTY OF
AFFECTED INDIVIDUAL. OPERATES ON AN INDIVIDUAL.
OPERATES ON A
CHAPTER 1 General Principles and Concepts of Taxation

DISTINCTION OF TAXATION,
POLICE POWER, AND
EMINENT DOMAIN (CONT’D)

TAXATION POLICE POWER EMINENT DOMAIN

7. AS TO BENEFITS
 CONTIN AND
S ORGANMARKET VALUE OF THE
PROTEC SOCIETYPROPERTY
EXPROPRIATED.

IMPOSITION COST OF NECESSAR

GENERALL REGULATIO Y
8. AS TO Y, NO N, LICENSE EXPENSES.
AMOUNT OF LIMIT. AND OTHER NO IMPOSITION.

CHAPTER 1 General Principles and Concepts of Taxation

DISTINCTION OF TAXATION, POLICE

POWER, AND EMINENT DOMAIN
 (CONT’D)
TAXATION POLICE POWER EMINENT DOMAIN
9. AS TO INSEPERCOMMON
IMPORTANCE FOR THENECESSITIES AND
EXISTENINTERESTS OF THE
A NATI COMMUNITY
SUPPORTRANSCEND
POLICEINDIVIDUAL RIGHTS IN
POWERPROPERTY.
EMINEN
DOMAI

AND INHERENT FROM CLAUSE.

10. AS TO LIMITATIONS. CONSTITUTIONAL SUPERIOR TO AND
LIMITATIONS. MAY OVER RIDE
RELATIONSHIP TO CONSTITUTIONAL
CONSTITUTION INFERIOR TO NON
IMPAIRMENT
SUBJECT TO IMPAIRMENT SUPERIOR TO NON PROVISION BECAUSE
CONSTITUTIONA L CLAUSE. IMPAIRMENT THE WELFARE OF THE
RELATIVELY FREE
STATE IS SUPERIOR TO ANY PRIVATE CONTRACT.

CHAPTER 1 General Princiles and Concets of Taxation

DISTINCTION OF TAXATION,
POLICE POWER, AND EMINENT
DOMAIN (CONT’D)

TAXATION POLICE POWER EMINENT DOMAIN

TIONAL AND DEMAND FOR PUBLIC PURPOSE
11. AS TO
INHERENT PUBLIC INTEREST AND JUST
LIMITATION
LIMITATIONS. AND DUE COMPENSATION
CONSTRAINTS
LIMITED BY THE PROCESS. .
BY CONSTITU
BOUNDED BY
 CHAPTER 1 General Principles and Concepts of Taxation

INHERENT LIMITATIONS
▪ THE NATURAL RESTRICTIONS TO SAFEGUARD AND
ENSURE THAT THE POWER OF TAXATION SHALL BE
EXERCISED BY THE GOVERNMENT ONLY FOR THE
BETTERMENT OF THE PEOPLE WHOSE INTEREST SHOULD
BE SERVED, ENHANCED AND PROTECTED.

1. TAXES MAY BE LEVIED ONLY FOR PUBLIC PURPOSES;

2. BEING INHERENTLY LEGISLATIVE, TAXATION MAY NOT BE
DELEGATED;
3. TAX POWER IS LIMITED TO TERRITORIAL JURISDICTION OF THE
STATE;
4. TAXATION IS SUBJECT TO INTERNATIONAL COMITY; AND
5. GOVERNMENT ENTITIES ARE GENERALLY TAX-EXEMPT.

CHAPTER 1 General Principles and Concepts of Taxation

CONSTITUTIONAL LIMITATIONS
▪ PROVISIONS OF THE FUNDAMENTAL LAW OF THE
LAND THAT RESTRICT THE SUPREME, PLENARY,
UNLIMITED AND COMPREHENSIVE EXERCISE BY THE
STATE OF ITS INHERENT POWER TO TAX.
 THE CONSITUTIONAL PROVISIONS THAT LIMIT THE EXERCISE OF THE
POWER TO TAX ARE AS FOLLOWS:
1. DUE PROCESS OF LAW;
2. EQUAL PROTECTION OF LAW;
3. RULE OF UNIFORMITY AND EQUITY;
4. PRESIDENT’S POWER TO VETO SEPARATE ITEMS IN REVENUE OR
TARIFF BILLS.

CHAPTER 1 General Principles and Concepts of Taxation

CONSTITUTIONAL LIMITATIONS
(CONT’D)

5. EXEMPTION FROM PROPERTY TAXATION OF RELIGIOUS,

CHARITABLE OR EDUCTAIONAL ENTITIES, NONPROFIT CEMETERIES,
CHURCHES, AND CONVENTS APPURTENANT THERETO;

6. NO PUBLIC MONEY SHALL BE APPROPRIATED FOR RELIGIOUS

PURPOSES.

7. MAJORITYOF ALL THE MEMBERS OF THE CONGRESS GRANTING

TAX EXEMPTIONS;

8. THE CONGRESS MAY NOT DEPRIVE THE SUPREME COURT OF ITS

JURISDICTION IN ALL CASES INVOLVING THE LEGALITY OF ANY TAX,
IMPOST OR ASSESSMENT OR TOLL OR ANY PENALTY IMPOSED IN
RELATION TO TAX;

CHAPTER 1 General Principles and Concepts of Taxation

CONSTITUTIONAL LIMITATIONS
(CONT’D)
9. NO IMPRISONMENT FOR NONPAYMENT OF POLL
TAX; AND

10. TAX COLLECTION SHALL GENERALLY BE TREATED

AS GENERAL FUNDS OF THE GOVERNMENT.

CHAPTER 1 General Principles and Concepts of Taxation

 DUE PROCESS OF LAW
▪ IT MANDATES A FUNDAMENTAL RIGHT OF PROTECTION
THAT LIFE, LIBERTY OR PROPERTY SHALL ONLY BE TAKEN
AWAY FROM ANY PERSON (NATURAL OR JURIDICAL) IF
ITS EXERCISE IS NOT CONTRARY TO THE FUNDAMENTAL
LAW OF THE LAND AND IT IS DONE AFTER COMPLIANCE
WITH THE ESTABLISHED PROCEDURE PRESCRIBED BY LAW.

▪ REQUIRES THAT THE LAW SHOULD BE REASONABLE AND

NOT OPPRESSIVE (SUBSTANTIVE), AND IT REQUIRES
OPPORTUNITY TO BE HEARD IN PROPER COURT OF
LITIGATION BEFORE JUDGEMENT IS RENDERED
AFFECTING ONE’S PERSON OR PROPERTY
(PROCEDURAL).
 CHAPTER 1 General Principles and Concepts of Taxation

DUE PROCESS OF LAW (CONT’D)

▪ PURPOSE OF DUE PROCESS
✔ TO SECURE THE INDIVIDUAL FROM THE
ABUSIVE EXERCISE OF THE TAXING POWER OF
THE GOVERNMENT.

▪ “EQUAL PROTECTION OF THE LAWS”

✔ ALL PERSONS SUBJECT TO LEGISLATION SHALL
BE TREATED ALIKE UNDER SIMILAR
CIRCUMSTANCES AND CONDITIONS BOTH IN THE
 PRIVILEGES CONFERRED AND LIABILITIES
IMPOSED.

CHAPTER 1 General Principles and Concepts of Taxation

DUE PROCESS OF LAW (CONT’D)

▪ PURPOSE THE CONSTITUTIONAL MANDATE

✔ ON EQUAL PROTECTION IS TO PROTECT

PERSONS BELONGING TO THE SAME CLASS
AGAINST INTENTIONAL AND ARBITRARY
DISCRIMINATION.
 CHAPTER 1 General Principles and Concepts of Taxation

RULE ON UNIFORMITY AND

EQUITY IN TAXATION

▪ “EQUALITY IN TAXATION”

✔ SIMILAR TO PROGRESSIVE SYSTEM OF TAXATION.

 ✔ TAX LAWS AND THEIR IMPLEMENTATION MUST BE FAIR,
JUST, REASONABLE AND PROPORTIONATE TO ONE’S
ABILITY TO PAY.

▪ PRIMARY REQUISITE OF EQUITY PRINCIPLE:

✔ A PROGRESSIVE TAX RATE SHALL BE APPLIED EQUALLY

TO ALL PERSONS, FIRMS, AND CORPORATION, AND
TRANSACTIONS PLACED IN SIMILAR CLASSIFICATION
AND SITUATION.

CHAPTER 1 General Principles and Concepts of Taxation

RULE ON UNIFORMITY AND

EQUITY IN TAXATION (CONT’D)
▪ PROGRESSIVE SYSTEM OF TAXATION

✔ TAX LAWS SHALL GIVE EMPHASIS ON DIRECT RATHER

THAN INDIRECT TAXES OR ON THE ABILITY-TO-PAY
PRINCIPLE OF TAXATION.

CHAPTER 1 General Principles and Concepts of Taxation

 PRESIDENT’S VETO POWER
“VETO POWER”
✔ REFERS TO THE EXECUTIVE’S POWER TO REFUSE TO SIGN INTO
LAW A BILL THAT HAS BEEN PASSED BY A LEGISLATURE.

IT CAN BE DEFINED INTO:

A. ITEM VETO
✔ THE POWER TO VETO ITEMS IN APPROPRIATION BILLS
WITHOUT AFFECTING ANY OTHER PROVISIONS OF SUCH
BILLS, AND
B. POCKET VETO
✔ THE POWER TO DISAPPROVE LEGISLATIVE ACT BY THE
PRESIDENT WITH THE RESULT THAT BILLS SHALL FAIL TO
 BECOME LAWS.

CHAPTER 1 General Principles and Concepts of Taxation

EXEMPTION FROM PROPERTY

TAXATION
▪ THE EXEMPTION IS GRANTED IN RETURN FOR THE
BENEFITS THEY HAVE AFFORDED FOR THE PUBLIC
WELFARE.

▪ TO BE EXEMPTED FROM TAXATION, THE REAL

PROPERTY MUST BE EXCLUSIVELY USED FOR
RELIGIOUS, EDUCATIONAL AND
CHARITABLE PURPOSES.
 CHAPTER 1 General Principles and Concepts of Taxation

PUBLIC MONEY NOT RELIGIOUS

PURPOSES
▪ ART. VI, SECTION 29 OF THE CONSTITUTION
PROVIDES THAT “NO PUBLIC MONEY OR PROPERTY SHALL EVER
BE APPROPRIATED, APPLIED, PAID OR USED DIRECLY OR
INDIRECTLY FOR THE USE, BENEFIT, OR SUPPORT OF ANY SECT,
CHURCH, DENOMINATION, SECTARIAN, INSTITUTION, OR
SYSTEM OF RELIGION, OR FOR THE USE, BENEFIT OR SUPPORT
OF ANY PRIEST, PREACHER, MINISTER, OR RELIGIOUS TEACHER
 OR DIGNITARY AS SUCH, EXCEPT WHEN SUCH PRIEST,
PREACHER, MINISTER, OR DIGNITARY IS ASSIGNED TO ARMED
FORCES, OR TO ANY PENAL INSTITUTION, OR GOVERNMENT
ORPHANAGE OR LEPROSARIUM.”

⮚ LIKEWISE, THE CHURCH SHOULD NOT INTERFERE IN PURELY POLITICAL

MATTERS OR AFFAIRS EXCLUSIVELY FOR THE STATE. CONSEQUENTLY,
THE CONSTITUTION PROHIBITS AGAINST INFRINGEMENT OF RELIGIOUS
FREEDOM.
CHAPTER 1 General Principles and Concepts of Taxation

CONGRESS GRANTING TAX

EXEMPTION

▪ ART. VI, SECTION 28, PAR. 4 OF THE CONSTITUTION

PROVIDES THAT “NO LAW GRANTING ANY TAX
EXEMPTION SHALL BE PASSED WITHOUT THE
CONCURENCE OF A MAJORITY OF ALL THE
MEMBERS OF THE CONGRESS.”

⮚ PROVISION REQUIRES THE CONCURENCE OF THE MAJORITY

NOT OF THE ATTENDEES CONSTITUTING A QUORUM BUT OF
ALL THE MEMBERS OF THE CONGRESS.

CHAPTER 1 General Principles and Concepts of Taxation

SUPREME COURT’S FINAL

JUDGEMENT IN ALL TAX
CASES
▪ THE POWER OF JUDICIAL REVIEW IN TAXATION
IS LIMITED ONLY TO THE INTERPRETATION AND
APPLICATION OF TAX LAWS. THE JUDICIAL
TRIBUNALS HAVE NO CONCERN ON THE
WISDOM OF TAXING ACT. ITS POWER DOES
NOT INCLUDE INQUIRY IN THE POLICY OF
LEGISLATION. NEITHER CAN IT LEGITIMATELY
QUESTION OR REFUSE TO SANCTION THE
PROVISIONS OF ANY LAW CONSISTENT WITH
THE CONSTITUTION.

CHAPTER 1 General Principles and Concepts of Taxation

NO IMPRISONMENT FOR NON
PAYMENT OF POLL TAX

“POLL TAX”
✔ A TAX IMPOSED ON A PERSON AS A RESIDENT
WITHIN A TERRITORY OF THE TAXING AUTHORITY
WITHOUT REGARD TO HIS PROPERTY, BUSINESS OR
OCCUPATION.

⮚ IT IS TO BE NOTED THAT THE PROHIBITION OF IMPRISONMENT

APPLIES ONLY TO THE NON-PAYMENT OF POLL TAX.
 CHAPTER 1 General Principles and Concepts of Taxation

TAXES AS GENERAL FUNDS OF

THEGOVERNMENT

▪ ART. VI, SECTION 29, PAR. 3 OF THE PHILIPPINE

CONSTITUTION
STATES THAT “ALL MONEY COLLECTED ON ANY TAX LEVIED FOR A
SPECIAL PURPOSE SHALL BE TREATED AS A SPECIAL FUND AND PAID
OUT FOR SUCH PURPOSE ONLY. IF THE PURPOSE FOR WHICH A
 SPECIAL FUND WAS CREATED HAS BEEN FULFILLED OR
ABANDONED, THE BALANCE IF ANY, SHALL BE TRANSFERRED TO
THE GENERAL FUNDS OF THE GOVERNMENT.”

⮚ THUS, COLLECTION OF FEE WITH THE NATURE OF TAXES INTENDED FOR THE
PROMOTION OF SUGAR INDUCTRY SHALL BE TREATED AS A SPECIAL
FUND.

CHAPTER 1 General Principles and Concepts of Taxation

IMPORTANCE OF TAXATION

▪ IT IS THE PRIMARY SOURCE OF GOVERNMENT

REVENUE THAT IS USED TO EFFECTIVELY AND
PERMANENTLY PERFORM GOVERNMENT
FUNCTIONS.
 ⮚ WITHOUT TAXATION, THE OTHER INHERENT POWERS (POLICE
AND EMINENT DOMAIN POWERS) WOULD BE PARALYZED.

CHAPTER 1 General Principles and Concepts of Taxation

BASIS OF TAXATION
▪ ESTABLISHED BASED ON THE PRINCIPLES OF:
A. NECESSITY
✔ THE GOVERNMENT HAS A RIGHT TO COMPEL ALL ITS
 CITIZENS, RESIDENTS AND PROPERTY WITHIN ITS
TERRITORY TO CONTRIBUTE MONEY.
✔ TAXATION IS THE “LIFEBLOOD” OR THE “BREAD AND
BUTTER” OF THE GOVERNMENT AND EVERY CITIZEN
MUST PAY HIS TAXES.
B. RECIPROCAL DUTIES OF PROTECTION AND SUPPORT
BETWEEN THE STATE AND INHABITANTS.
✔ THE GOVERNMENT COLLECTS TAXES FROM THE
SUBJECT OF TAXATION IN ORDER THAT IT MAY BE ABLE
TO PERFORM ITS FUNCTIONS.

CHAPTER 1 General Principles and Concepts of Taxation

PURPOSES OF TAXATION
OBJECTIVES IN THE EXERCISE OF TAXING POWER
1. REVENUE PURPOSES
THE PRIMARY PURPOSE OF TAXATION IS TO RAISE REVENUE BY
COLLECTING FUNDS OR PROPERTY FOR THE SUPPORT OF THE
GOVERNMENT IN PROMOTING THE GENERAL WELFARE AND
PROTECTING ITS INHABITANTS.
2. REGULATORY PURPOSE
THIS OBJECTIVE IS ACCOMPLISHED TO
A. REGULATE INFLATION,
B. ACHIEVE ECONOMIC AND SOCIAL STABILITY,
AND C. SERVE AS KEY INSTRUMENT FOR SOCIAL
CONTROL

CHAPTER 1 General Principles and Concepts of Taxation

 PURPOSES OF TAXATION
(CONT’D) REGULATORY PURPOSES [CONT’D]

⮚ TAXES MAYBE USED AS A TOOL AND WEAPON IN INTERNATIONAL RELATIONS

AS A TOOL TO PROTECT TRADE RELATION, SPECIAL DUTIES MAYBE

CREATED TO PROTECT NEW CONDITIONS, SUCH AS:
(1) DISCRIMINATORY DUTY
THIS SPECIAL DUTY IS DESIGNED TO OFFSET ANY FOREIGN
DISCRIMINATION AGAINST OUR LOCAL COMMERCE.
(2) COUNTERVAILING DUTY
IT MAYBE IMPOSED TO OFFSET ANY FOREIGN SUBSIDY
GRANTED TO IMPORTED GOODS TO THE PREJUDICE OF OUR
LOCAL INDUSTRIES.
 CHAPTER 1 General Principles and Concepts of Taxation

PURPOSES OF TAXATION
(CONT’D)REGULATORY PURPOSE [CONT’D]
(3) MARKING DUTY
IT IS GENERALLY IMPOSED AS ADDITIONAL DUTY TAX
ON IMPORTED ARTICLES AND/OR CONTAINERS WITH IMPROPER
CLASSIFICATION.
(4) DUMPING DUTIES
IT REFERS TO THE ADDITIONAL DUTY TAXES IMPOSED
ON IMPORTED GOODS WITH PRICES LESSER THAN THEIR FAIR MARKET
VALUES TO PROTECT LOCAL INDUSTRIES.

3. COMPENSATORY PURPOSE
 TAXATION IS A WAY OF GIVING BACK THE EXPECTED
ECONOMIC AND SOCIAL BENEFIT DUE TO THE
INHABITANTS.

CHAPTER 1 General Principles and Concepts of Taxation

OBJECTS OF TAXATION

• OBJECTS OF TAXATION MAY REFER TO THE SUBJECT TO WHICH

TAXES ARE IMPOSED.

GENERALLY TAXES ARE IMPOSED ON THE FOLLOWING: 1.

PERSONS, WHETHER NATURAL OR JURIDICAL PERSONS;
2. PROPERTIES, WHETHER REAL, PERSONAL, TANGIBLE OR
INTANGIBLE PROPERTIES;
 3. EXCISE OBJECT, SUCH AS TRANSACTIONS, PRIVILEGE, RIGHT
AND INTEREST.

CHAPTER 1 General Principles and Concepts of Taxation

CERTAIN DOCTRINES IN
TAXATION
1. PROSPECTIVITY OF 3. DOUBLE TAXATION
TAX LAWS 4. ESCAPE FROM
2. IMPRESCRIPTIBILITY TAXATION
OF TAXES 5. EXEMPTION FROM
TAXATION
 6. EQUITABLE COMPROMISES
RECOUPMENT 10. POWER TO
7. SET-OFF TAXES 8. DESTROY
TAXPAYER SUIT 9.

CHAPTER 1 General Principles and Concepts of Taxation

CERTAIN DOCTRINES IN TAXATION

(CONT’D)

1. PROSPECTIVITY OF TAX LAWS

 THE PRINCIPLE OF PROPECTIVITY OF TAX LAWS
STATES THAT A TAX BILL MUST ONLY BE APPLICABLE
AND OPERATIVE AFTER BECOMING A LAW.
2. IMPRESCRIPTIBILITY OF TAXES
THIS PRINCIPLE STATES THAT UNLESS
OTHERWISE PROVIDED BY THE TAX LAW ITSELF, TAXES
IN GENERAL ARE NON CANCELLABLE.

CHAPTER 1 General Principles and Concepts of Taxation

CERTAIN DOCTRINES IN TAXATION

(CONT’D)
3. DOUBLE TAXATION
MEANS AN ACT OF THE SOVEREIGN BY TAXING
TWICE FOR THE SAME PURPOSE IN THE SAME YEAR UPON
THE SAME PROPERTY OR ACTIVITY OF THE SAME PERSON,
WHEN IT SHOULD BE TAXED ONCE, FOR THE SAME
PURPOSE AND WITH THE SAME KIND OF CHARACTER OF
TAX.
⮚ TO AVOID INJUSTICE AND UNFAIRNESS, DOUBTS AS TO WHETHER DOUBLE
TAXATION HAS BEEN IMPOSED SHOULD BE RESOLVED IN FAVOR OF THE TAXPAYER

CHAPTER 1 General Principles and Concepts of Taxation

 CERTAIN DOCTRINES IN TAXATION
(CONT’D)

INDIRECT DUPLICATE TAXATION.

▪ THIS IS DOUBLE TAXATION IN ITS BROAD SENSE.
▪ IT EXTENDS TO ALL CASES IN WHICH THERE IS A BURDEN OF
TWO OR MORE PECUNIARY IMPOSITIONS.

DIRECT DUPLICATE TAXATION.

▪ THIS IS DOUBLE TAXATION IN ITS STRICT SENSE.

▪ IT IS PROHIBITED BECAUSE IT COMPRISES IMPOSITION OF THE
SAME TAX ON THE SAME PROPERTY FOR THE SAME PURPOSE BY
THE SAME STATE DURING THE SAME TAXING PERIOD.
 CHAPTER 1 General Principles and Concepts of Taxation

CERTAIN DOCTRINES IN TAXATION

(CONT’D)
HOW TO COUNTER ACT INDIRECT DOUBLE TAXATION?
1. TAX EXEMPTIONS;
2. RECIPROCITY CLAUSE/ TAX TREATY;
3. TAX CREDIT;
4. TAX EXEMPTIONS; AND
5. ALLOWANCE FOR DEDUCTIONS SUCH AS VANISHING DEDUCTION IN ESTATE TAX.

THERE IS NO DOUBLE TAXATION IN THE FOLLOWING CASES:

1. BY TAXING CORPORATE INCOME AND STOCKHOLDER’S DIVIDENDS FROM THE SAME
CORPORATION.
2. A TAX IMPOSED BY THE STATE AND THE LOCAL GOVERNMENT UPON THE SAME
OCCUPATION , CALLING OR ACTIVITY.
3. REAL ESTATE TAX AND INCOME TAX COLLECTED ON THE SAM REAL ESTATE PROPERTY
LEASED FOR EARNING PURPOSES.
4. TAXES ARE IMPOSED ON THE TAXPAYER’S FINAL PRODUCT AND THE STORAGE OF RAW
MATERIALS USED IN THE PRODUCTION OF THE FINAL PRODUCT.

CHAPTER 1 General Principles and Concepts of Taxation

CERTAIN DOCTRINES IN TAXATION

(CONT’D)

4. ESCAPE FROM TAXATION

THE WAYS BY WHICH A TAX PAYER COULD ESCAPE TAX BURDENS
MAY BE THROUGH TAX EVASION AND TAX AVOIDANCE.
“TAX EVASION”
▪UNDER THIS METHOD, THE TAX PAYER USES UNLAWFUL MEANS
TO EVADE OR LESSEN THE PAYMENT OF TAX.
 ▪THIS FORM OF TAX DODGING IS PROHIBITED AND THEREFORE
SUBJECT TO CIVIL AND/ OR CRIMINAL PENALTIES.

“TAX AVOIDANCE”
▪THIS IS THE REDUCING OR TOTALLY ESCAPING PAYMENT OF
TAXES THROUGH LEGALLY PERMISSIBLE MEANS.

CHAPTER 1 General Principles and Concepts of Taxation

CERTAIN DOCTRINES IN TAXATION

(CONT’D)

FORMS OF TAX AVOIDANCE

(1.) TAX OPTION

 ▪ TAXPAYERS MAY CHOOSE TO PAY LOWER TAX RATE IN SOME
TRANSACTIONS AS PERMITTED BY TAX LAWS.

(2.) SHIFTING
▪ IS THE TRANSFER OF TAX BURDEN TO ANOTHER; THE
IMPOSITION OF TAX IS TRANSFERRED FROM THE STATUTORY
TAXPAYER TO ANOTHER WITHOUT VIOLATING THE LAW.

CHAPTER 1 General Principles and Concepts of Taxation

CERTAIN DOCTRINES IN TAXATION

(CONT’D)
FORMS OF TAX AVOIDANCE [CONT’D]
(3.) TRANSFORMATION
 ▪ THE PRODUCER ABSORBS THE PAYMENT OF TAX TO REDUCE
PRICES AND TO MAINTAIN MARKET SHARE, THEN HE RECOVERS
HIS ADDITIONAL TAX EXPENSES BY IMPROVING THE PROCESS OF
PRODUCTION.

(4.) EXEMPTION FROM TAXATION

▪ DENOTES A GRANT OF IMMUNITY, EXPRESSED OR IMPLIED, TO
A PARTICULAR PERSON, CORPORATION, OR TO PERSONS OR
CORPORATIONS OF A PARTICULAR CLASS , FROM A TAX UPON
PROPERTY OR AN EXCISE WHICH PERSONS AND CORPORATION
GENERALLY WITHIN THE SAME TAXING DISTRICT ARE OBLIGED TO
PAY.
▪ TAX EXEMPTIONS ARE GENERALLY GRANTED IN THE BASIS OF
(a) RECIPROCITY, (b) PUBLIC POLICY, AND (C) CONTRACTS.
CHAPTER 1 General Principles and Concepts of Taxation

CERTAIN DOCTRINES IN TAXATION

(CONT’D)
CLASSIFICATIONS OF TAX EXEMPTION
TAX EXEMPTION MAYBE CLASSIFIED AS:
(1.) EXPRESSED EXEMPTION
▪ THESE TAX EXEMPTIONS ARE STATUTORY LAWS IN NATURE AS
PROVIDED BY CONSTITUTION, STATUTE, TREATIES, ORDINANCES,
FRANCHISES OR SIMILAR LEGISLATIVE ACTS.

(2.) IMPLIED EXEMPTION OR BY OMISSION

▪ THESE EXEMPTIONS ARE EITHER INTENTIONAL OR
ACCIDENTAL.
▪ THESE OCCUR WHEN TAX IS IMPOSED ON A CERTAIN CLASS
OF PERSONS, PROPERTIES OR TRANSACTIONS WITHOUT
MENTIONING OTHER CLASSES; THOSE NOT MENTIONED ARE
DEEMED EXEMPTED BY OMISSION.(PRINCIPLE OF LAW).

CHAPTER 1 General Principles and Concepts of Taxation

 CERTAIN DOCTRINES IN TAXATION
(CONT’D)

CLASSIFICATIONS OF TAX EXEMPTION [CONT’D]

(3.) EXPRESSED EXEMPTION

▪ ARE EXEMPTIONS THAT ARE LAWFULLY ENTERED INTO BY THE
GOVERNMENT IN CONTRACT UNDER EXISTING LAWS.
▪ THESE EXEMPTIONS MUST NOT BE CONFUSED WITH THE TAX
EXEMPTIONS GRANTED UNDER FRANCHISES, WHICH ARE NOT
CONTRACTS WITHIN THE CONTEXT OF NON-IMPAIRMENT CLAUSE
OF THE CONSTITUTION.
 CHAPTER 1 General Principles and Concepts of Taxation

CERTAIN DOCTRINES IN TAXATION

(CONT’D)

6. EQUITABLE RECOUPMENT
THIS DOCTRINE OF LAW STATES THAT A TAX CLAIM FOR
REFUND, WHICH IS PREVENTED BY PRESCRIPTION, MAY BE
ALLOWED TO BE USED AS PAYMENT FOR UNSETTLED TAX LIABILITIES
IF BOTH TAXES ARISE FROM THE SAME TRANSACTION IN WHICH
OVERPAYMENT IS MADE AND UNDERPAYMENT IS DUE.

7. SET-OFF TAXES
 THIS DOCTRINE STATES THAT TAXES ARE NOT SUBJECT TO SET
OFF OR LEGAL COMPENSATION BECAUSE THE GOVERNMENT AND
THE TAXPAYER ARE NOT MUTUAL CREDITOR AND DEBTOR OF EACH
OTHER.

CHAPTER 1 General Principles and Concepts of Taxation

CERTAIN DOCTRINES IN TAXATION

(CONT’D)

8.) SET-OFF TAXES [CONT’D]

** A PERSON CANNOT REFUSE TO PAY TAX ON THE BASIS THAT THE GOVERNMENT OWES
HIM AN AMOUNT EQUAL TO OR GREATER THAN THE TAX BEING COLLECTED.

EXEMPTION TO THIS RULE:

1.) WHERE BOTH THE CLAIMS OF THE GOVERNMENT AND THE TAXPAYER
AGAINST EACH OTHER HAVE ALREADY BECOME DUE, DEMANDABLE
AND FULLY LIQUIDATED;
2.) WHERE THERE IS AN ACTUAL COMPROMISE BETWEEN THE TAXPAYER
AND THE TAX OFFICER.

CHAPTER 1 General Principles and Concepts of Taxation

CERTAIN DOCTRINES IN TAXATION

(CONT’D)

9.) TAXPAYER SUIT

 IS EFFECTED THROUGH COURT PROCEEDINGS AND COULD ONLY
BE ALLOWED IF THE ACT INVOLVES A DIRECT AND ILLEGAL
DISBURSEMENT OF PUBLIC FUNDS DERIVED FROM TAXATION.

10.) COMPROMISES

THIS DOCTRINE PROVIDES THAT COMPROMISES ARE GENERALLY

ALLOWED AND ENFORCEABLE WHEN THE SUBJECT MATTER THEREOF IS
NOT PROHIBITED FROM NOT BEING COMPROMISED AND THE PERSON
ENTERING SUCH COMPROMISE IS DULY AUTHORIZED TO DO SO.

CHAPTER 1 General Principles and Concepts of Taxation

CERTAIN DOCTRINES IN TAXATION

 (CONT’D)

11.) POWER TO DESTROY

THIS PRINCIPLE IMPLIES THAT AN IMPOSITION OF LAWFUL

REGULATORY TAXES WOULD BE DESTRUCTIVE TO THE TAXPAYERS AND
BUSINESS ESTABLISHMENTS BECAUSE THE GOVERNMENT CAN COMPEL
PAYMENT OF TAX AND FORFEITURE OF PROPERTY THROUGH THE
EXERCISE OF POLICE POWER.
 CHAPTER 1 General Principles and Concepts of Taxation

CERTAIN DOCTRINES IN TAXATION

(CONT’D)

POWER TO BUILD

TAX POWER IS PRIMARILY A TOOL THAT CREATES, BUILDS AND

SUSTAINS THE UPLIFTMENT OF SOCIAL CONDITION OF THE PEOPLE IN
GENERAL AS IT CONTINOUSLY SUPPORTS THE OTHER INHERENT POWERS
OF THE STATE THAT PRESERVE THE FUNDAMENTAL RIGHTS OF THE
PEOPLE.
SITUS OF TAXATION

THIS REFERS TO THE PLACE OF TAXATION, OR THE STATE OR

POLITICAL UNIT WHICH HAS JURISDICTION TO IMPOSE TAX OVER ITS
INHBITANTS.

CHAPTER 1 General Principles and Concepts of Taxation

SITUS OF TAXATION (CONT’D)

GENERAL RULE: THE STATE HAS THE POWER TO IMPOSE TAX ONLY
WITHIN ITS TERRITORIAL JURISDICTION.
THE FOLLOWING FACTORS ARE DETERMINANTS TO THE SITUS OF
TAXATION:

1. Nature, kind of classification of the tax being imposed; 2.

Subject matter of the tax (person, property, rights or activity); 3.
Source of the income being taxed;
4. Place of the excise, privilege, business or occupation being
taxed;
5. Citizenship of the taxpayer;
6. Residence of the taxpayer.
CHAPTER 1 General Principles and Concepts of Taxation

NATURE OF TAXES
 “TAXES”
are forced burdens, charges, exactions, impositions or
contributions assessed in accordance with some reasonable rule
of appointment, by authority of a sovereign state, upon the
person, property, or rights exercised, within its jurisdiction, to
provide public revenues for the support of the government, the
administration of the law, or the payment of public expenses.

⮚ Taxes are obligations created by law.

⮚ Taxes are generally personal to the taxpayer.

 CHAPTER 1 General Principles and Concepts of Taxation

NATURE OF TAXES (CONT’D)

ESSENTIAL CHARACTERISTICS OF TAXES

1. Enforced contribution.
2. Imposed by legislative body.
3. Proportionate in character.
4. Payable in form of money.
5. Imposed for the purpose of raising revenue.
6. Used for a public purpose.
 7. Enforced on some persons, properties or rights. 8.
Commonly required to be paid at regular intervals. 9.
Imposed by the sovereign state within its jurisdiction.

CHAPTER 1 General Principles and Concepts of Taxation

NATURE OF TAXES (CONT’D)

CLASSIFICATION OF TAXES
1. AS TO PURPOSE

a. Revenue or Fiscal
These taxes are imposed solely for the purpose of raising
revenue for the government.
 b. Regulatory, Special or Sumptuary
These taxes are imposed for the purpose of achieving some
social or economic goals having no relation to the raising of
revenue.

CHAPTER 1 General Principles and Concepts of Taxation

NATURE OF TAXES (CONT’D)

2. AS TO OBJECT OR SUBJECT MATTER

a. Personal, Poll or Capitation
These taxes are fixed in amount and imposed on persons
residing within a specified territory regardless of the amount of
their property or their occupation or business.
 b. Property
These taxes are imposed on personal or real property
bases on its proportionate value or in accordance with other
reasonable method of apportionment.
c. Excise
These taxes are imposed upon the performance of a right or
act, the enjoyment of a privilege or the engagement in an
occupation

CHAPTER 1 General Principles and Concepts of Taxation

NATURE OF TAXES (CONT’D)

3. AS TO DETERMINATION OF AMOUNT
a. Ad Valorem
 - These taxes are fixed amounts in proportion to the value of
the property with respect to which the tax is assessed.
- It requires the intervention of Assessors to estimate the
value of such property before the amount due to the taxpayer
be determined.

b. Specific
- These taxes are fixed amounts imposed and based on
some standard of weight or measurement, head or number,
length or volume.
- It requires independent assessment other than a listing or
classification of the subject to be taxed.

CHAPTER 1 General Principles and Concepts of Taxation

NATURE OF TAXES (CONT’D)

4. AS TO WHO BEARS THE BURDEN
a. Direct
- These taxes are non-transferable.
- The liability for the payment of tax as well as the tax falls
on the same person.

b. Indirect
- These taxes are transferable.
- The liability for the payment of tax falls on one person but
the burden thereof can be shifted or passed to another.
 CHAPTER 1 General Principles and Concepts of Taxation

NATURE OF TAXES (CONT’D)

5. AS TO SCOPE OR AUTHORITY COLLECTING THE TAX

a. National
- Taxes collected by the national government (E.g. Estate
and donor’s taxes).

b. Local or Municipal
- Taxes collected by the Municipal government (E.g.
Community tax).
 CHAPTER 1 General Principles and Concepts of Taxation

NATURE OF TAXES (CONT’D)

6. AS TO RATE OR GRADUATION
a. Proportional or Flat Rate
- The rate of the tax is based on a fixed percentage of the
amount of the property, receipt or other basis to be taxed.

b. Progressive or Graduated Rate

 - The rate of the tax increases as the tax base or bracket
increases (e.g. Income Tax and Estate Tax)

c. Mixed Tax
- A system that uses all or a combination of the different taxes
based on rates.

CHAPTER 1 General Principles and Concepts of Taxation

OTHER CHARGES/ FEES

1. PENALTY – Is any sanction imposed, as a punishment for

violations of law or acts deemed injurious.

2. REVENUE – refers to all funds or income derived whether from

 tax or from other sources.

3. DEBT – is an obligation to pay or render service from a definite

future period based on contract.

4. TOLL – is a compensation for the use of somebody else’s

property determined by the cost of the improvement.

5. LICENSE FEE – is a contribution enforced by the government

primarily to restrain and regulate business or occupation.

CHAPTER 1 General Principles and Concepts of Taxation

OTHER CHARGES/ FEES (CONT’D)

6. CUSTOMS DUTIES - are imposition or imported goods

 brought into the country to protect local industry.

7. SUBSIDY – is a monetary aid directly given or granted by

the government to an individual or private commercial
enterprises deemed beneficial to the public.

8. TARIFF – is a schedule or lists of rates, duties of taxes

imposed on imported goods.

9. MARGIN FEE – is a tax on foreign exchange designed to

curb excessive demands upon our international
reserves.

10. SPECIAL ASSESSMENT – is an amount collected by the

government for the purpose of reimbursing itself for certain
extended benefits regarding construction of public works.

CHAPTER 1 General Principles and Concepts of Taxation

TAX LAW DEFINED

 “TAX LAW”
is that body of laws including income, estate, gift, excise, stamp
and other taxes.
** The TAX CODE is an example of a special law which prevails over a general law such as
the Civil Code or the Rules of Court.

INTERNAL REVENUE LAW

- It includes all laws legislated pertaining to the national
government taxes which is embodied in the NIRC. - The
main purpose of promulgating internal revenue laws is to
rise money to meet the pecuniary needs by the
government.

INTERNAL REVENUE TAXES

- taxes imposed by the legislative body other than custom
duties on imports.
 CHAPTER 1 General Principles and Concepts of Taxation

NATURE OF TAX LAW

❖ THE PHILIPPINES INTERNAL REVENUE LAWS

ARE GENERALLY CIVIL IN NATURE; THEY
ARE NEITHER POLITICAL NOR PENAL IN
NATURE.
 CHAPTER 1 General Principles and Concepts of Taxation

INTERPRETATION & APPLICATION OF

TAX LAW
THE FOLLOWING RULES ARE GENERALLY FOLLOWED FOR THE
INTERPRETATION AND APPLICATION OF TAX LAWS:

1. TAX STATUTE MUST BE ENFORCED AS WRITTEN.

2. IMPOSITION OF TAX BURDENS IS NOT PRESUMED.

 3. DOUBTS SHOULD BE RESOLVED LIBERALLY IN FAVOR OF THE
TAXPAYER.

4. TAX EXEMPTIONS ARE STRICTLY CONSTRUED AGAINST THE

TAXPAYER.

5. TAX LAWS ARE APPLIED PROSPECTIVELY.

6. TAX LAWS PREVAIL OVER CIVIL LAWS.

CHAPTER 1 General Principles and Concepts of Taxation

SOURCES OF PHILIPPINE TAX LAWS

THE PHILIPPINES REPUBLIC MAKES LAWS WHICH MAYBE COMPRISED

OF THE FOLLOWING:
 1. CONSTITUTION OF THE PHILIPPINES;
- THIS REFERS TO THAT BODY OF RULES AND MAXIMS IN
ACCORDANCE WITH WHICH THE POWER OF SOVEREIGNITY
ARE HABITUALLY EXERCISED.

2. STATUTES;
- THESE ARE LAWS ENACTED AND ESTABLISHED BY THE
CIVIL WILL OF THE LEGISLATIVE DEPARTMENT OF THE
GOVERNMENT.

CHAPTER 1 General Principles and Concepts of Taxation

SOURCES OF PHILIPPINE TAX LAWS

(CONT’D)

3. EXECUTIVE ORDERS;
 - THESE ARE REGULATIONS ISSUED BY THE PRESIDENT OR
SOME ADMINISTRATIVE UNDER HIS DIRECTION FOR THE
PURPOSE OF INTERPRETING, IMPLEMENTING, OR GIVING
ADMINISTRATIVE EFFECT TO A PROVISION OF THE
CONSTITUTION OR SOME LAW OR TREATY.
4. TAX TREATIES AND CONVENTION WITH FOREIGN COUNTRIES;
- THESE REFER TO THE TREATIES OR INTERNATIONAL
AGREEMENTS WITH FOREIGN COUNTRIES REGARDING TAX
ENFORCEMENT AND EXEMPTIONS.

CHAPTER 1 General Principles and Concepts of Taxation

SOURCES OF PHILIPPINE TAX LAWS

 (CONT’D)

5. REVENUE REGULATIONS BY THE DEPARTMENT OF FINANCE;

- THESE ARE RULES OR ORDERS HAVING FORCE OF LAW
ISSUED BY EXECUTIVE AUTHORITYOF THE GOVERNEMENT TO
ENSURE UNIFORM APPLICATION OF TAX LAWS.

IN ORDER THAT ADMINISTRATIVE REGULATIONS MAYBE CONSIDERED

VALID, ALL OF THE FOLLOWING REQUISITES MUST BE COMPLIED WITH:

1. THE REGULATIONS MUST BE USEFUL IN PRACTICAL AND NECESSARY

FOR THE ENFORCEMENT OF THE LAW;
2. THEY MUST BE REASONABLE IN THEIR PROVISIONS;
3. THEY MUST NOT BE CONTRARY TO LAW; AND
4. THEY MUST BE DULY PUBLISHED IN THE OFFICIAL GAZZETE.
 CHAPTER 1 General Principles and Concepts of Taxation

SOURCES OF PHILIPPINE TAX LAWS

(CONT’D)

6. BIR REVENUE MEMORANDUM CIRCULARS & BUREAU OF CUSTOMS

MEMORANDUM ORDERS;
- THESE ARE ADMINISTRATIVE RULINGS OR OPINIONS WHICH
ARE LESS GENERAL INTERPRETATION OF TAX LAWSBEING ISSUED BY
TIME TO TIME BY THE COMMISSIONEROF THE INTERNAL REVENUE AND
BUREAU OF CUSTOMS, AS THE CASE MAYBE.
7. BIR RULINGS;
- THESE ARE EXPRESSED OFFICIAL INTERPRETATION OF THE
TAX LAWS AS APPLIED TO SPECIFIC TRANSACTIONS.
8. JUDICIAL DECISIONS;
 - THESE REFER TO THE DECISIONS FOR APPLICATION MADE
CONCERNING TAX ISSUES BY THE PROPER COURT EXERCISING
JUDICIAL AUTHORITY OF COMPETENT JUSRISDICTION.

CHAPTER 1 General Principles and Concepts of Taxation

SOURCES OF PHILIPPINE TAX LAWS

(CONT’D)

9. LOCAL TAX ORDINANCES

- THESE ARE TAX ORDINANCES ISSUED BY THE
PROVINCE, CITY, MUNICIPALITY AND
BARANGAYS/BARRIOS SUBJECT TO SUCH LIMITATIONS AS
PROVIDED BY THE LOCAL GOVERNMENT CODE AND THE
REAL PROPERTY TAX CODE.
CHAPTER 1 General Principles and Concepts of Taxation