8/6/2019 Reviewer Tax

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TAX ATIONSan Beda College of LAW ALABANG

ENERAL PRINCIPLES

I. Concepts, Nature and Characteristics of Taxation andTaxes.

Taxation Defined:

As a process, it is a eans !" #hich the so$erei%n, throu%h its&a#' a(in% !od", raises re$enue to defra" the necessar" expensesof the %o$ern ent. It is ere&" a #a" of apportionin% the costs of %o$ern ent a on% those #ho in so e easures are pri$i&e%ed toen)o" its !enefits and ust !ear its !urdens.

As a po#er , taxation refers to the inherent po#er of the state tode and enforced contri!utions for pu!&ic purpose or purposes.

Rationa&e of Taxation 'The Supre e Court he&d:*It is said that taxes are #hat #e pa" for ci$i&i+ed societ".

ithout taxes, the %o$ern ent #ou&d !e para&"+ed for &ac( of theoti$e po#er to acti$ate and operate it. -ence, despite the natura&

re&uctance to surrender part of one s hard'earned inco e to thetaxin% authorities, e$er" person #ho is a!&e ust contri!ute his sharein the runnin% of the %o$ern ent. The %o$ern ent for its part isexpected to respond in the for of tan%i!&e and intan%i!&e !enefitsintended to i pro$e the &i$es of the peop&e and enhance their ora&and ateria& $a&ues. Thes" !iotic re&ationship is the rationa&eof taxation and shou&d dispe& the erroneous notion that it is anar!itrar" ethod of exaction !" those in the seat of po#er.

Taxation is a s" !iotic re&ationship, #here!" in exchan%efor the protection that the citi+ens %et fro the %o$ern ent, taxes arepaid./ 0Co issioner of Interna& Re$enue $s A&&e%re, Inc.,et a&., L'12234, 5e!. 67, 63228

Purposes and 9!)ecti$es of Taxation

6. Re$enue to pro$ide funds or propert" #ith #hich the Statepro otes the %enera& #e&fare and protection of its citi+ens.

1. Non'Re$enue ;PR1EP