Introduction to Taxation

John V. Balanquit

Objectives • • • After the presentation, students should be able to: Identify and distinguish the objects of taxation Explain the doctrines of taxation Explain the “situs of taxation”

Objectives (continued) • • • Identify the nature of taxes and explain the characteristics of taxes Determine the classification of taxes Distinguish taxes from other fees

Objects of Taxation • • • Persons (natural or juridical) Properties (tangible or intangible, real or personal) Excise objects (transactions, privilege, rights or interests)

Doctrines of Taxation • • • • • Prospectivity of tax laws Imprescriptibility of taxes Double taxation (indirect and direct) Escape from taxation (tax evasion vs tax avoidance) Equitable recoupment

Doctrines of Taxation • • • • Set-off of taxes Taxpayer suit Compromise Power to build and destroy

Situs of Taxation • • • • It is the “place” of taxation. It may be based on the: Nature of tax Citizenship and residence of taxpayer Source of income Place of the item subject to tax

Nature of Taxes • • Taxes are: Obligations created by law Generally personal to the taxpayer

Essential Characteristics of Taxes • • • • • • Enforced contributions Imposed by the legislative body Proportionate in character Payable in the form of money Imposed for the purpose of raising revenue Used for public purpose

Essential Characteristics of Taxes • • • Enforced on persons, properties or rights Commonly required to be paid in regular intervals Imposed by the sovereign state within its jurisdiction

Classifications of Taxes • • As to Purpose Revenue/Fiscal Regulatory/Sumptuary

Classifications of Taxes • • • As to Object Personal/ Poll/ Capitation Property Excise

Classifications of Taxes • • As to Determination of Amount Ad Valorem Specific

Classifications of Taxes • • As to Who Bears the Burden Direct Indirect

Classifications of Taxes • • As to Authority or Scope National (transfer taxes, income taxes, VAT, percentage taxes, excise taxes, documentary stamp tax) Local (Community tax, municipal license tax, professional tax, real estate tax)

Classifications of Taxes • • • As to Rate or Graduation Proportionate/ Flat Rate Progressive/ Graduated Mixed

Other Fees • • • • • • Penalty Revenue Debt Toll License fee Customs duties

Other Fees • • • • Subsidy Tariff Margin fee Special assessment

End of Lecture.

Thank You!