UCP: PRELIM EXAMITAION

TAXATTION

NAME: SCORE:
DATE:

1. Which of the following statements is incorrect?

a. Taxes are the revenues raised in the exercise of the police power of the State.
b. One of the special characteristic of tax is it is unlimited in amount.
c. The three fundamental powers of the State are Inherent in the State and may be
exercised without the need of any constitutional grant.
d. All of the above

2. Which theory in taxation states that without taxes, a government would be

paralyzed for lack of power to activate and operate it, resulting in its
destruction?
a. Power to destroy theory
b. Lifeblood theory
c. Sumptuary theory
d. Symbiotic doctrine

3. The following are the nature of taxation, except

a. Inherent and sovereignty
b. Essentially a legislative function
c. Subject to inherent and constitutional limitation
d. Subject to the approval of the people

4. One of the characteristics of our internal revenue laws is that they are
a. Political in nature
b. Penal in nature
c. Generally prospective in operation although the tax statute may nevertheless
operate retrospectively provided it is clearly the legislative intent
d. Criminal in nature

5. In every case of doubt, tax statutes are construed

a. Strictly against the government and the taxpayer
b. Liberally in favor of the government and the taxpayer
c. Strictly against the government and liberally in favour of the taxpayer
d. Liberally in favor of the government and strictly against the tax payer

6. In every case of doubt, tax exemption are construed

a. Strictly against the government and the taxpayer
b. Liberally in favor of the government and the taxpayer
c. Strictly against the government and liberally in favour of the taxpayer
d. Liberally in favour of the government and strictly against the taxpayer

7. Tax of fixed proportion of the amount or value of the property with respect to
which the tax assessed
a. Ad-valorem c. Excise
b. Specific d. Revenue
UCP: PRELIM EXAMITAION
TAXATTION
8. Double taxation in its general sense means taxing the same subject twice during
the same taxing period. In this sense, double taxation
a. Violates substantive due process.
b. Does not violate substantive due process.
c. Violates the right to equal protection.
d. Does not violate the right to equal protection.

Use the following data for the next five (5) questions:
A taxpayer, married without qualified dependent child, had the following data for
taxable year 2018:
Gross income, Philippines P800,000
Gross income, USA 600,000
Expenses, Philippines 400,000
Expenses, USA 300,000

9. If the taxpayer is a resident citizen, married, his taxable income is'

a. P400.000 c. P700,000
b. P350,000 d. P650,000

10. If the taxpayer is a non-resident citizen, his taxable income is

a. P400.000 c. P700,000
b. P350.000 d. P650,000

11. If the taxpayer is resident alien, his taxable income is

a. P400,000 c. P700,000
b. P350.000 d. P650,000

12. If the taxpayer is a non-resident alien engage in trade or business in the

Philippines, his taxable income is
a. P400,000 c. P700,000
b. P360,000 d. P660.000

13. If the taxpayer is a non-resident alien nor engage in business in the

Philippines, married and his country grants P40.000 as a personal exemption for
married individuals, his taxable income is
a. P800.000 c. P360.000
b. P400,000 d. P350.000

14. Taxable only on income from sources within the Philippines, except
a. Resident citizen
b. Nonresident citizen
c. Resident alien
d. Nonresident alien

15. LJ, married, left the Philippines in the middle of the year on July 1, 2018 to
go abroad and work there for five (5) years. The following data were provided as
of December 31,2018:

Gross Business Income Business Expenses

PERIOD Phls. Abroad Phls. Abroad
UCP: PRELIM EXAMITAION
TAXATTION
Jan. 1 to June 30 P300,000 P200,000 P100,000 P50,000
July 1 to Dec. 31 600,000 400,000 150,000 50,000

His taxable income is:

a. P800,000
b. P950,000
c. P1,100,000
d. P600,000

16. Ana is a mixed income earner. She is a self-employed resident citizen and
currently the
Finance manager of Omega Corporation. The following data were provided for 2018
taxable year:
Compensation income P1,800,000
Sales 2,800,000
Cost of sales. 1,125,000
Business Expenses 650,000

How much is her total income tax due assuming she opted to be taxed at 8%?
a. P321,500
b. P788,500
c. P654,000
d. P754,000

17. Using the above information, how much is her total income tax due if she failed
to signify to be taxed at 8%.
a. P321,500
b. P788,500
c. P654,000
d. P754,000

18. No law granting any tax exemption shall be passed without the concurrence of -
a. Majority of all members of Congress
b. 2/3 vote of all members of Congress
c. 3A vote of all members of Congress
d. Unanimous vote of all members of Congress

19. It literally means "place of taxation" the country that has the power and
jurisdiction to levy and collect the tax
a. Basis of taxation
b. Situs of taxation.
c. Scope of taxation
d. Theory of taxation

20. One is not a direct tax

a. Immigration tax
b. Transfer tax
c. Income tax
d. Value-added tax
UCP: PRELIM EXAMITAION
TAXATTION

TRUE/FALSE

1. Individual taxpayers are natural persons with income derived within the
territorial jurisdiction of a taxing authority.
2. Incomes earned outside the Philippines by OFWs are tax exempt because they
are considered non-resident citizen.
3. The intention with regard to the length and nature of stay of an alien
determines whether he is a resident or non-resident.
4. A foreigner who has acquired residency in the Philippines shall only become
a non-resident when he actually departs with the intention of abandoning his
residency in the Philippines.
5. An alien individual, whether a resident or not of the Philippines, is
taxable only on income derived from sources within the Philippines.
6. A foreigner who shall live in the Philippines with no definite intention as
to his stay is a non-resident alien.
7. Non-resident alien who shall come to the Philippines and stay herein for an
aggregate period of more than 180 days during any calendar year is subject to
the rule on reciprocity under the Tax Code with respect to their allowed
personal exemption.
8. An alien individual is deemed doing business in the Philippines if he shall
come to the Philippines and stay herein for an aggregate period of more than
180 days during the calendar year.
9. Generally, a non-resident alien not engaged in trade or business is subject
to 25% creditable withholding tax on his gross income in the Philippines.
10. Taxation is a process or means by which the sovereign, through its law
making body raises income to defray the expenses of the government.
11. Eminent domain may be exercise even by public service corporations and
public entities.
12 Police power regulates both liberty and property.
13. Taxes are raised to cover the cost of governance.
14. Tax is generally unlimited because it is based on the needs of the State.
15. Tax laws are civil and penal in nature because there are penalties provided
in the case of violation.
16. A revenue bill may originate from the Senate and on which same bill the
House of Representatives may propose amendments.
17. A person may refuse to pay on the ground that he will not receive a benefit
from the tax.
18. In the exercise of the power of taxation, the State can tax anything at any
time.
19. In cases of deductions and exemptions, doubts shall be resolved liberally
in favor of the government.
20. Levying of local government taxes should be exercise only by the
legislative branch of the local government.
UCP: PRELIM EXAMITAION
TAXATTION
ENUMERATION

1-5 Classification of taxpayers

6-8 Three Inherent power of the state
9-11 Elements of Sound Tax System
11-15 Scope of taxation
16-18 Aspects of taxation
19-20 Purpose of Taxation