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TEST BANK-INCOME TAXATION

CHAPTER 1-GENERAL PRINCIPLES AND CONCEPTS OF
TAXATION
A.MULTIPLE CHOICE:
1. THE PROCESS BY WHICH THE SOVEREIGN RAISES INCOME TO
DEFRAY THE EXPENSES OF THE GOVERNMENT IS CALLED- (RPCPA)
A.
B.
C.
D.

SUBSIDY
TARIFF
TAXATION
TRIBUTE

2. ONE OF THE CHARACTERISTICS OF INTERNAL REVENUE TAX IS
THAT THEY ARE-(RPCPA)
A)
B)

C)
D)

CRIMINAL IN NATURE
PENAL IN NATURE
POLITICAL IN NATURE
GENERALLY PROSPECTIVE IN APPLICATION

3. IN CASE OF CONFLICT BETWEEN THE TAX LAWS AND GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES (GAAP)-(RPCPA)
A)
B)
C)
D)

BOTH TAX LAWS AND GAAP SHALL BE ENFORCED
GAAP SHALL PREVAIL OVER TAX LAWS
TAX LAWS SHALL PREVAIL OVER GAAP
THE ISSUE SHALL BE RESOLVED BY THE COURT

4. WHICH OF THE FOLLOWING HAS NO POWER OF TAXATION?(RPCPA)
A)
B)
C)
D)

PROVINCES
CITIES
BARANGAYS
BARRIOS

5. “SCHEDULAR SYSTEM OF INCOME TAXATION” MEANS(RPCPA)
A) ALL TYPES OF INCOME ARE ADDED TOGETHER TO ARRIVE AT
GROSS INCOME
B) SEPARATE GRADUATED RATES ARE IMPOSED ON DIFFERENT
TYPES OF INCOME
C) CAPITAL GAINS ARE EXCLUDED IN DETERMINING GROSS
INCOME



D) COMPENSATION INCOME AND BUSINESS/PROFESSIONAL
INCOME ARE ADDED TOGETHER IN ARRIVING AT GROSS
INCOME
6. ONE OF THE FOLLOWING IS A PRIMARY PURPOSE OF TAXATION
A)PROTECTION
OF
LOCAL
INDUSTRIES
AGAINST
FOREIGN
COMPETITION THROUGH IMPOSITION OF HIGH CUSTOMS DUTIES ON
IMPORTED GOODS
B)REDUCTION OF INEQUALITIES IN WEALTH AND INCOME BY
IMPOSING PROGRESSIVELY HIGHER TAX RATES
C) TO SECURE REVENUE FOR THE SUPPORT OF THE GOVERNMENT
D) STRENGTHENING OF ANEMIC ENTERPRISES BY GIVING TAX
EXEMPTION
7. WHICH OF THE
TAXATION?

FOLLOWING IS NOT A SECONDARY PURPOSE OF

A) TO SERVE AS KEY INSTRUMENT OF SOCIAL CONTROL
B) TO EFFECT A MORE EQUITABLE DISTRIB UTION OF WEALTH
AMONG PEOPLE
C) TO ACHIEVE SOCIAL AND ECONOMIC STABILITY
D) TO RAISE REVENUE TO DEFRAY THE NECESSARY EXPENSE OF
THE GOVERNMENT
8. WHICH IS THE BEST ANSWER? A TAX REFORM AT ANY GIVEN TIME
UNDERSCORES THE FACT THAT-(RPCPA)
A)
B)
C)
D)

TAXATION IS AN INHERENT POWER OF THE STATE
TAXATION IS ESSENTIALLY A LEGISLATIVE POWER
TAXATION IS A POWER THAT IS VERY BROAD
THE STATE CAN AND SHOULD ADOPT PROGRESSIVE TAXATION

9.
THE LEGISLATIVE BODY CAN IMPOSE A TAX AT ANY
AMOUNT UNDERSCORES THE LEGAL DICTUM THAT TAXATION IS –
(RPCPA)
A)
B)
C)
D)

AN INHERENT POWER OF THE TAX
A VERY BROAD POWER OF THE STATE
ESSENTIALLY A LEGISLATIVE POWER
FOR PUBLIC PURPOSE

10.
ALL OF THE FOLLOWING, EXCEPT ONE, ARE BASIC
PRINCIPLES OF THE SOUND TAX SYSTEM
A) FISCAL ADEQUACY


B) THEORETICAL JUSTICE
C) ADMINISTRATIVE FEASIBILITY
D) INHERENT IN SOVEREIGNTY
11. UNDER THIS BASIC PRINCIPLE OF SOUND TAX SYSTEM, THE
GOVERNMENT SHOULD NOT INCUR A DEFICIT-(RPCPA)
A)
B)
C)
D)

THEORETICAL JUSTICE
ADMINISTRATIVE FEASIBILITY
FISCAL ADEQUACY
NONE OF THE ABOVE

12. THE FOLLOWING, EXCEPT ONE, ARE BASIC PRINCIPLES OF A SOUND
TAX SYSTEM
A) IT SHOULD BE CAPABLE OF BEING EFFECTIVELY ENFORCED
B) IT MUST BE PROGRESSIVE
C) SOURCES OF REVENUE MUST BE SUFFICIENT TO
GOVERNMENT EXPENDITURES AND OTHER PUBLIC NEEDS
D) IT SHOULD BE EXERCISED TO PROMOTE PUBLIC WELFARE

MEET

13.
WHICH OF THE FOLLOWING IS NOT ONE OF THE CANONS OF A
SOUND TAX SYSTEM?
A)
B)
C)
D)
14.

QUANTIFIABILITY
EQUALITY
CERTAINTY
CONVENIENCE

THE POWER OF TAXATION CAN ONLY BE EXERCISED BY THE
LAWMAKING BODY
A)
B)
C)
D)

SUBJECT TO CONSTITUTIONAL AND INHERENT LIMITATIONS
EQUALITY OR THEORETICAL JUSTICE
LEGISLATIVE IN CHARACTER
INHERENT IN SOVEREIGNTY

15. THE PRESIDENT OF THE PHILIPPINES AND THE PRIME MINISTER OF
JAPAN ENTERED INTO AN EXECUTIVE AGREEMENTIN RESPECT OF A
LOAN FACILITY TO THE PHILIPPINES FROM JAPAN WHEREBY IT WAS
STIPULATED THAT INTEREST ON LOANS GRANTED BY PRIVATE
JAPANESE FINANCIAL INSTITUTIONS IN THE PHILIPPINES SHALL
NOT BE SUBJECT TO PHILIPPINE INCOME TAXES. WHAT BASIC
CHARACTERISTIC OF TAXATION HAS BEEN VIOLATED BY THIS
AGREEMENT?


A)
B)
C)
D)

INHERENT LIMITATION
THEORETICAL JUSTICE
LEGISLATIVE IN CHARACTER
ADMINISTRATIVE FEASIBILITY

16. WHICH STATEMENT GIVES THE CORRECT ANSWER? THAT A
FEASIBILITY STUDY NEEDS OR NEED TO LOOK INTO THE TAXES OF
DIFFERENT POLITICAL SUBDIVISIONS OF GOVERNMENT WHICH MAY
BE ALTERNATIVE SITES OF BUSINESS BECAUSE-(RPCPA)
A) PROVINCES, CITIES AND MUNICIPALITIES MUST HAVE UNIFORM
TAXES BETWEEN AND AMONG THEMSELVES
B) THE LOCAL TAXES OF A POLITICAL SUBDIVISION NEED NOT BE
UNIFORM WITH THE LOCAL TAXES OF ANOTHER POLITICAL
SUBDIVISION
C) BUSINESSES THAT ARE SUBJECT TO NATIONAL TAXES ARE
EXEMPTED FROM LOCAL BUSINESS TAXES
D) LOCAL BUSINESS TAXES MAY BE CREDITED AGAINST NATIONAL
BUSINESS TAXES
17. STATE,MENT 1:THE POWER OF TAXATION IS INHERENT IN
SOVEREIGNTY BEING ESSENTIAL TO THE EXISTENCE OF EVERY
GOVERNMENT. HENCE, EVEN IF NOT MENTIONED IN THE
CONSTITUTION, THE STATE CAN STILL EXERCISE THE POWER.
STATEMENT 2:IT IS ESSENTIALLY A LEGISLATIVE FUNCTION. EVEN
IN THE ABSENCE OF ANY CONSTITUTIONAL PROVISION, TAXATION
POWER FALLS TO CONGRESS AS PART OF THE GENERAL POWER OF
LAWMAKING.-(RPCPA)
A)
B)
C)
D)

FALSE, FALSE
FALSE, TRUE
TRUE, TRUE
TRUE, FALSE

18. THOSE RESTRICTIONS ON THE EXERCISE OF THE POWER OF
TAXATION THAT AREW FOUND IN THE CONSTITUTION OR IMPLIED
FROM ITS PROVISIONS
A)
B)
C)
D)

THEORETICAL JUSTICE
LEGISLATIVE IN CHARACTER
INHERENT LIMITATIONS
CONSTITUTIONAL LIMITATIONS


19. WHICH OF THE FOLLOWING STATEMENTS IS NOT CORRECT?-(RPCPA)
A) TAXES MAY BE IMPOSED TO RAISE REVENUE OR TO PROVIDE
DISINCENTIVES TO CERTAIN ACTIVITIES WITHIN THE STATE
B) THE STATE CAN HAVE THE POWER OF TAXATION EVEN IF THE
CONSTITUTION DOES NOT NECESSARILY GIVE IT THE POWER TO
TAX
C) FOR THE EXERCISE OF THE POWER OF TAXATION, THE STATE CANJ
TAX ANYTHING AT ANY TIME
D) THE POWER OF TAXATION IN THE PHILIPPINE CONSTITUTION ARE
GRANTS OF POWER AND NOT LIMITATIONS ON TAXING POWERS
20. ONE OF THE FOLLOWING IS NOT AN INHERENT LIMITATION ON THE
EXERCISE OF THE POWER OF TAXATIONA)
B)
C)
D)

INTERNATIONAL COMITY
DOUBLE TAXATION
NON-DELEGATION OF THE LEGISLATIVE POWER TO TAX
TERRITORIALITY

21. THE CITY COUNCIL PASSED AN ORDINANCE IMPOSING AN
OCCUPATION TAX ON AN AIRCONDITIONING TECHNICIAN. CONDE IS
THE ONLY PERSON WITH SUCH OCCUPATION IN THE CITY. HE
CHALLENGED THE VALIDITY OF THE ORDINANCE AS BEING
DISCRIMINATORY SINCE HE IS THE ONLY ONE ADVERSELY
AFFECTED.
A) THE CONTENTION OF CONDE IS TENABLE
B) THE ORDINANCE IS UNCONSTITUTIONAL BECAUSE CONDE IS
DENIED OF HIS RIGHT TO EQUAL PROTECTION OF LAW
C) THE CONTENTION OF CONDE IS NOT JUSTIFIED BECAUSE THE
RULE ON UNIFORMITY IS NOT VIOLATED CONSIDERING THAT
THE
ORDINANCE
WOULD
ALSO
IMPOSE
ON
ALL
AIRCONDITIONING TECHNICIAN WHO MAY COME WITHIN THE
JURISDICTION OF THE CITY
D) THE ISSUE ON VALIDITY OR INVALIDITY OF THE ORDINANCE
SHOULD BE SET ASIDE
22. TREATING PERSONS WHO ARE SIMILARLY SITUATED IN THE SAME
MANNERA)
B)
C)
D)

UNIFORMITY OF TAXATION
EQUALITY OF TAXATION
DUE PROCESS OF LAW
NON-DELEGATION OF LEGISLATIVE POWER


23. WHICH OF THE FOLLOWING IS VIOLATIVE OF THE UNIFORMITY
RULE IN TAXATION?
A) DIFFERENT TAX RATES ON BOARDING STABLES FOR
RACEHORSES AND BOARDING HORSES THAT ARE NOT FOR
RACING
B) WHOLESALE DEALERS IN OIL ARE SUBJECT TO OCCUPATION
TAX WHILE WHOLESALE DEALERS IN OTHER ARTICLES SCU AS
SUGAR, BACON, COAL, IRON AND OTHER THINGS ARE NOT SO
SUBJECT
C) A ROAD USERS’ TAX IMPOSED ON ALL MOTOR VEHICLES
REGISTERED AND OPERATING IN THE CITY OF MANILA BUT
DOES NOT SUBJECT VEHICLES NOT REGISTERED THEREIN BUT
ALSO OPERATING TEMPORARILY IN SAID CITY
D) A TAX OF P2 PER SQM OR FRACTION THEREOF IS IMPSED ON
EVERY BILLBOARD OR SIGN ANYWHERE IN THE COUNTRY
24. THE LUNG CENTER OF THE PHILIPPINES, A CHARITABLE
INSTITUTION, IS ERECTED IN THE MIDDLE OF A 12-HECTARE LOT:
I.

II.
III.
IV.

A BIG SPACE AT ITS GROUND FLOOR IS BEING LEASED TO
PRIVATE PARTIES, FOR CANTEEN AND SMALL STORE SPACES,
AND TO MEDICAL OR PROFESSIONAL PRACTITIONERS WHO
USE THE SAME AS THEIR PRIVATE CLINICS FOR THEIR
PATIENTS WHOM THEY CHARGE FOR THEIR PROFESSIONAL
FEES.
THE REST OF THE PORTIONS OF THE BUILDING ARE USED FOR
ITS PATIENTS, WHETHER PAYING OR NON-PAYING
ALMOST ½ OF THE ENTIRE AREA OF THE LOT ON THE LEFT
SIDE OF THE BUILDING IS VACANT AND IDLE
A BIG PORTION ON THE RIGHT SIDE IS BEING LEASED FOR
COMMERCIAL PURPOSES TO A PRIVATE ENTERPRISE KNOWN
AS THE ELLIPTICAL ORCHIDS & GARDEN CENTER

WHICH PORTION IS SUBJECT TO REAL PROPERTY TAX?
A)
B)
C)
D)

I ONLY
I AND II
III AND IV
I, III AND IV


25. STATEMENT 1:THE CONSTITUTIONAL EXEMPTION ON INCOME
TAXES, PROPERTY TAXES AND CUSTOMS DUTIES IS ALLOWED ON
NON-STOCK, NON-PROFIT EDUCATIONAL INSTITUTIONS ONLY.
STATEMENT 2: A BUILDING BEING LEASED BY ITS OWNER TO A PRIVATE
EDUCATIONAL INSTITUTION FOR USE AS CLASSROOMS IS EXEMPT FROM
PROPERTY YAX
STATEMENT 3: INCOME OF A NON-STOCK, NON-PROFIT EDUCATIONAL
INSTITUTION RUN BY THE ARCHDIOCESE IS EXMEPT FROM TAX PROVIDED
THAT INCOMES ARE ACTUALLY, DIRECTLY AND EXCLUSIVELY USED FOR
EDUCATIONAL PURPOSES
WHICH OF THE STATEMENTS ARE CORRECT?
A)
B)
C)
D)

STATEMENT 1 ONLY
STATEMENTS 1 AND 2
STATEMENT 2 ONLY
ALL OF THEM

26. WHICH OF THE FOLLOWING STATEMENTS IS NOT CORRECT?-(RPCPA)
A) AN INHERENT LIMITATION OF TAXATION MAY BE DISREGARDED BY
THE APPLICATION OF A CONSTITUTIONAL LIMITATION
B) THE PROPERTY OF AN EDUCATIONAL INSTITUTION OPERATED BY A
RELIGIOUS ORDER IS EXEMPT FROM PROPERTY TAX, BUT ITS
INCOME IS SUBJECT TO INCOME TAX
C) THE PROHIBITION OF DELEGATION BY THE STATE OF THE POWER OF
TAXATION WILL STILL ALLOW THE BIR TO MODIFY THE RULES ON
TIME FOR FILING OF RETURNS AND PAYMENT OF TAXES
D) THE POWER OF TAXATION IS SHARED BY THE LEGISLATIVE AND
EXECUTIVE DEPARTMENTS OF GOVERNMENT
27. ST. BARNABAS COLLEGE (SBC) IS A NON-STOCK, NON-PROFIT
EDUCATIONAL INSTITUTION. IT OWNS A 5-HECTARE LOT ½ OF
WHICH IS BEING USED AS ITS SCHOOL CAMPUS WHILE THE OTHER
HALF IS VACANT. TO COPE WITH THE INCREASING OPERATING
COSTS AND TO UPGRADE ITS FACILITIES, SBC PLANS TO DO THE
FOLLOWING EFFECTIVE JANUARY 1, 2006; 1). RENT OUT TO A
MARKETING FIRM THE VACANT PORTION OF THE LAND; 2)
INJCREASE TUITION FEES BY 10% IN ACCORDANCE WITH
GOVERNMENT REGULATIONS;.3)IMPORT 20 SETS OF COMPUTERS
FOR USE IN ITS COMPUTER COURSES.


WHICH OF THE FOLLOWING QUESTIONS IS ANSWERABLE BY “YES.”?
A) IS SBC SUBJECT TO REAL ESTATE TAX ON THE ½ PORTION TO
BE RENTED OUT TO A BUSINESS ESTABLISHMENT?
B) WILL IT BE EXEMPT FROM INCOME TAX ON ITS RENTAL TO
THE MARKETING FIRM?
C) WILL THE INCREASE IN TUITION FEES BE SUBJECT TO INCOME
TAX IF IT RESULTS TO NET INCOME FROM SCHOOL
OPERATIONS?
D) WILL IT BE SUBJECT TO CUSTOMS DUTIES ON THE
IMPORTATION OF THE COMPUTERS?
28. THE QUEZON SCHOOL OF BUSINESS AND ARTS, A PROPRIETARY
EDUCATIONAL INSTITUTION WHICH IS OFFERING PRIMARY,
SECONDARY AND TERTIARY EDUCATIONB, IS REGISTERED AND
ACCREDITED BY DEPED AND CHED.
WHICH OF THE FOLLOWING IS EXEMPT FROM TAX? WHAT KIND OF
TAX?
A) THE IMPORTATION OF LABORATORY EQUIPMENTS-FROM
CUSTOMS DUTIES
B) THE SCHOOL BEING RENTED BY THE SCHOOL-FROM REAL
PROPERTY TAX
C) A PORTION OF THE SCHOOL BUILDING BEING LEASED TO A
FASTFOOD CHAIN-FROM REAL PROPERTY TAX
D) THE INCOME FROM OPERATION-FROM INCOME TAX
29. IN RELATION TO NO. 28 ABOVE, ASSUMING THAT THE
SCHOOL IS A NON-STOCK, NON-PROFIT EDUCATIONAL
INSTITUTION, WHICH OF THE FOLLOWING IS SUBJECT
TO TAX ? WHAT KIND OF TAX?
A) THE SCHOOL BUILDING OWNED BY THE SCHOOL-FROM
REAL ESTATE TAX
B) THE SCHOOL BUILDING BEING RENTED BY THE SCHOOLFROM REAL ESTATE TAX
C) A PORTION OF THE SCHOOL BUILDING BEING LEASED TO A
FASTFOOD CHAIN-FROM REAL PROPERTY TAX
D) THE INCOME FROM OPERATION-FROM INCOME TAX

30.
THE MUNICIPALITY OF SAN FRANCISCO HAS A 10HECTARE CEMETERY OF 4 DIFFRRENT CEMETERIES WHICH
ARE OWNED BY DIFFERENT ENTITIES. WHICH OF THE
FOLLOWING IS SUBJECT TO REAL ESTATE TAX?


A) CEMENTERIO MUNICIPAL DEL SAN FRANCISCO-A GOV’T
CEMETERY OWNED BY THE MUNICIPALITY WHICH WAS
ESTABLISHED FOR THE PURPOSE OF USING IT AS BURIAL
GROUND OF THE PAUPERS OF SAN FRANCISCO
B) SAN FRANCISCO CATHOLIC CEMETERY-OWNED BY THE
CATHOLIC CHURCH; PAYMENTS ARE REMITTED TO THE
CATHOLIC CHURCH AND FOR THE IMPROVEMENT OF THE
CEMETERY
C) LAST TRIP MEMORIAL PARK-OWNED BY A CORPOR5ATION
WHERE DIVIDENDS ARE DISTRIBUTED TO THE SHAREHOLDERS
AT THE END OF THE YEAR
D) QUITA-QUITA MEMORIAL PARK-OWNED BY AN ASSOCIATION
CONSISTING OF 100 DIFFERENT FAMILIES; EACH FAMILY OWNS
SEVERAL SQUARE METERS OF LOT; NOT A SINGLE PORTION IS
HELD FOR SALE TO EITHER MEMBER OR NON-MEMBERS OF
THE ASSOCIATION
31.ALL APPROPRIATIONS, REVENUE OR TARIFF BILLS, BILLS
AUTHORIZING INCREASE OF PUBLIC DEBT, BILLS OF LOCAL
APPLICATION, AND BILLS SHALL ORIGINATE EXCLUSIVELY IN THE(RPCPA)
A)
B)
C)
D)

OFFICE OF THE PRESIDENT
HOUSE OF REPRESENTATIVES
SENATE
SUPREME COURT

32 WHICH STATEMENT IS WRONG? TAX LAWS-(RPCPA)
A) MUST ORIGINATE FROM THE HOUSE OF REPRESENTATIVES AND ON
WHICH SAME BILL THE SENATE MAY PROPOSE AMENDMENTS
B) MAY ORIGINATE FROM THE SENATE AND ON WHICH SAME BILL THE
HOUSE OF REPRESENTATIVES MAY PROPOSE AMENDMENTS
C) MAY HAVE A HOUSE VERSION AND SENATE VERSION APPROVED
SEPARATELY
D) MAY BE RECOMMENDED BY THE PRESIDENT TO CONGFRESS
33.CONGRESSMAN ERIN TANADA OF QUEZON AND SENATOR JUAN
PONCE ENRILE SPONSORED A BILL IN THE HOUSE OF
REPRESENTATIVES AND THE SENATE, RESPECTIVELY, INCREASING THE
PERSONAL EXEMPTIONS OF INDIVIDUAL TAXPAYERS AS WELL AS
GRANTING TAX EXEMPTION TO MINIMUM WAGE EARNERS. WHICH OF
THE FOLLOWING IS CORRECT?


A) THE SENATE BILL SHOULD BE DISCUSSED AHEAD OF THE HOUSE
BILL
B) THE SENATE AND HOUSE BILLS MAY BE DISCUSSED AT THE SAME
TIME IN BOTH HOUSES
C) THE HOUSE BILL SHOULD BE DISCUSSED AHEAD NOF THE SENATE
BILL
D) NO PRIORITY; EACH BILL CAN BE DISCUSSED AHEAD OF THE OTHER
34.NO LAW GRANTING ANY TAX EXEMPTION SHALL BE PASSED WITHOUT
THE CONCURRENCE OF-(RPCPA)
A)
B)
C)
D)

MAJORITY OF ALL MEMBERS OF THE CONGRESS
2/3 VOTE OF ALL MEMBERS OF THE CONGRESS
¾ VOTE OF ALL MEMBERS OF THE CONGRESS
UNANIMOUS VOTE OF ALL MEMBERS OF THE CONGRESS

35.WHICH OF THE FOLLOWING STATEMENTS IS INCORRECT?
A) NO PERSON SHALL BE IMPRISONED FOR NON-PAYMENT OF DEBT OR
NON-PAYMENT OF TAXES
B) THE PASSAGE OF LAWS GRANTING TAX EXEMPTIONS REQUIRES THE
CONCURRENCE BY A MAJORITY OF ALL THE MEMBERS OF
CONGRESS
C) THE SUPREME COURT’S JURISDICTION OVER TAX CASES CAN NOT
BE IMPAIRED
D) THE REVENUES AND ASSETS OF NON-STOCK, NON-PROFIT
EDUCATIONAL INSTITUTIONS AND DONATIONS FFOR EDUCATIONAL
PURPOSES ARE EXEMPTED FROM TAXES AND DUTIES
36.THEY RESTRICT THE EXERCISE OF THE POWER OF TAXATION
ALTHOUGH THEY ARE NOT EMBODIED IN THE CONSTITUTION
A)
B)
C)
D)

THEORETICAL JUSTICE
LEGISLATIVE IN CHARACTER
INHERENT LIMITATIONS
CONSTUTIONAL LIMITATIONS

37. A TAX MUST BE IMPOSED FOR PUBLIC PURPOSE. WHICH OF THE
FOLLOWING IS NOT A PUBLIC PURPOSE?-(RPCPA)
A)
B)
C)
D)

NATIONAL DEFENSE
PUBLIC EDUCATION
IMPROVEMENT OF SUGAR INDUSTRY
NONE OF THE ABOVE


38. A FUNDAMENTAL RULE IN TAXATION IS THAT “THE PROPERTY OF
ONE COUNTRY MAY NOT BE TAXED BY ANOTHER COUNTRY”. THIS IS
KNOWN AS-(RPCPA)
A)
B)
C)
D)

INTERNATIONAL LAW
INTERNATIONAL COMITY
RECIPROCITY
INTERNATIONAL INHIBITION

39.QUESTION 1: CAN THE STATE TAX THE ARMED FORCES OF THE
PHILIPPINES?
QUESTION 2: ARE GOVERNMENT-OWNED
CORPORATIONS SUBJECT TO TAX?

AND

CONTROLLED

A)YES, NO
B)YES, YES
C)NO, YES
D)NO, NO
40 DIPLOMATIC OFFICIALS SUCH AS HEADS OF STATES AND
AMBASSADORS ARE EXEMPT FROM TAXES AND DUTIES BECAUSE OF
A)
B)
C)
D)

INTERNATIONAL COMITY
RECIPROCITY PROVISIONS
PRINCIPLE OF TERRITORIALITY
EXEMPTION IN THE TAX CODE

41. DEALS WITH THE PROVISION OF THE LAW WHICH DETERMINES THE
PERSON OR PROPERTY TO BE TAXED, THE SUM OR SUMS TO BE RAISED,
THE RATE THEREOF, AND THE TIME AND MANNER OF LEVYINGM
RECEIVING AND COLLECTING OF TAXES
A)
B)
C)
D)

COLLECTION
PAYMENT
ENFORCED CONTRIBUTION
LEVY

42. CONSTITUTED OF THE PROVISIONS OF LAW WHICH PRESCRIBE THE
MANNER OF ENFORCING THE OBLIGATION ON THE PART OF THOSE TAXED
TO PAY THE DEMAND THUS CREATED
A)
B)
C)
D)

COLLECTION
PROPORTIONATE IN CHARACTER
ENFORCED CONTRIBUTION
LEVY


43.THE AMOUNT REQUIRED IS DICTATED BY THE NEEDS OF THE
GOVERNMENT-(RPCPA)
A)
B)
C)
D)

LICENSE FEE
TAX
TOLL
TARIFF

44. ONE OF THE CHARACTERISTICS OF A TAX IS
A) A TAX IS A PECUNIARY BURDEN AND THE LAW MAY NOT ALLOW
PAYMENT IN KIND
B) IT IS DEPENDENT UPON THE WILL OR CONTRACTUAL ASSENT,
EXPRESS OR IMPLIED, OF THE PERSON TAXED
C) IT IS LEVIED BY THE STATE BY VIRTUE OF ITS SOVEREIGNTY
D) IT IS COLLECTED FOR PUBLIC AND PRIV ATE PURPOSE
45. ONE OF THE CHARACTERISTICS OF A TAX IS THAT-(RPCPA)
A)
B)
C)
D)

IT IS GENERALLY BASED ON CONTRACT
IT IS GENERALLY PAYABLE IN MONEY
IT IS GENERALLY ASSIGNABLE
OPTIONAL

46. WHICH IS NOT AN ESSENTIAL CHARACTERISTIC OF TAX?-(RPCPA)
A)
B)
C)
D)

UNLIMITED AS TO AMOUNT
PAYABLE IN MONEY
PROPORTIONATE IN CHARACTER
REGULAR IN PAYMENT

47. NO PERSON SHALL BE IMPRISONED FOR NON-PAYMENT OF-(RPCPA)
A)
B)
C)
D)

PROPERTY TAX
EXCISE TAX
POLL TAX
INCOME TAX

48. AN EXAMPLE OF A PROPERTY TAX IS
A) ADDITIONAL COMMUNITY TAX ON INCOME OF REAL PROPERTIES
B) REAL ESTATE TAX ON REAL PROPERTIES
C) ESTATE TAX ON INHERITED PERSONAL AS WELL AS REAL
PROPERTIES
D) DONOR’S TAX ON DONATION OF PROPERTY


49. WHICH OF THE FOLLOWING IS NOT AN EXAMPLE OF EXCISE TAX?
A)
B)
C)
D)

TRANSFER TAX
SALES TAX
REAL PROPERTY TAX
INCOME TAX

50. SHARON, A CPA HAS JUST OBTAINED HER CPA LICENSE. BEFORE SHE
CAN LAWFULLY PURSUE HER OCCUPATION, SHE SHOULD PAY(RPCPA)
A)
B)
C)
D)

PRIVILEGE TAX(PTR)
PERCENTAGE TAX
CPA’S INCOME TAX
VALUE-ADDED TAX

51. A TAX THAT IS IMPOSED UPON A PERSON WHO IS DIRECTLY BOUND
TO PAY ITA)
B)
C)
D)

DIRECT TAX
INDIRECT TAX
EXCISE TAX
POLL TAX

52. ONE IS NOT A DIRECT TAX-(RPCPA)
A)
B)
C)
D)

IMMIGRATION TAX
TRANSFER TAX
INCOME TAX
CONTRACTOR’S TAX

53.THE BASIC COMMUNITY TAX OF P5.00 OF AN INDIVIDUAL IS A(AN)\
A) PROPERTY TAX
B) DIRECT TAX
C) NATIONAL TAX
D) AD VALOREM TAX
54. STATEMENT 1: THE VALUE-ADDED TAX IS A PROPERTRY TAX
STATEMENT 2: THE ESTATE TAX IS A DIRECT TAX-(RPCPA)
A)
B)
C)
D)

THE 2 STATEMENTS ARE CORRECT
THE 2 STATEMENTS ARE WRONG
STATEMENT 1 IS CORRECT; STATEMENT 2 IS WRONG
STATEMENT 1 IS WRONG; STATEMENT 2 IS CORRECT


55.FORMS PART OF THE PURCHASE PRICE OF THE COMMODITY OR
SERVICE AND PASSED ON TO CUSTOMERS
A)
B)
C)
D)

DIRECT TAX
INDIRECT TAX
PROPERTY TAX
NONE OF THE ABOVE

56. A TAX ON BUSINESS IS-(RPCPA)
A)
B)
C)
D)

DIRECT TAX
INDIRECT TAX
PROPERTY TAX
NONE OF THE ABOVE

57. FELIX IS A MINING OPERATOR. HIS MINERAL LANDS ARE NOT COVERED
BY ANY LEASE CONTRACT. THE TAX FELIX HAS TO PAY BASED ON THE
ACTUAL VALUE OF THE GROSS OUTPUT OR MINERAL PRODUCTS
EXTRACTED IS-(RPCPA)
A)
B)
C)
D)

MINING TAX
ROYALTIES
RENTAL
AD VALOREM TAX

58.TAX THAT IS IMPOSED SOLELY TO RAISE REVENUE FOR GOV’T
EXPENDITURES
A)
B)
C)
D)

REVENUE TAX
REGULATORY TAX
SPECIFIC TAX
AD VALOREM TAX

59.TAX LEVIED FOR PARTICULAR OR SPECIFIC PURPOSE IRRESPECTIVE
OF WHETHER REVENUE IS ACTUALLY RAISED OR NOT
A)
B)
C)
D)

REVENUE TAX
REGULATORY TAX
SPECIFIC TAX
AD VALOREM TAX

60..TAX IMPOSED BY THE NATIONAL GOVERNMENT AND IS EFFECTIVE
WITHIN THE ENTIRE JURISDICTION THEREOF
A) NATIONAL TAX
B) LOCAL TAX


C) PROPORTIONAL TAX
D) GENERAL TAX
61. TAXES IMPOSED BY A POLITICAL SUBDIVISION OF THE STATE AND
IS EFFECTIVE ONLY WITHIN THE TERRITORIAL BOUNDARIES
THEREOF
A) NATIONAL TAX
B) LOCAL TAX
C) PROGRESSIVE TAX
D) REGRESSIVE TAX
62.THE FOLLOWING ARE KINDS OF TAXES AS TO GRDUATION. WHICH ONE
IS NOT?-(RPCPA)
A)
B)
C)
D)

DIGRESSIVE
UNIFORM
REGRESSIVE
PROGRESSIVE

63.THE POWER OF THE STATE OR THOSE TO WHOM THE POWER HAS BEEN
DELEGATED TO TAKE PRIVATE PROPERTY FOR PUBLIC USE UPON PAYING
TO THE OWNER A JUST COMPENSATION
A)
B)
C)
D)

POWER OF EMINENT DOMAIN
POLICE POWER
POWER OF TAXATION
PEOPLE POWER

64.THERE CAN BE CLASSIFICATION OF THE SUBJECT MATTER BEING
REQUIRED TO SHOULDER THE BURDEN. WHICH IS THE EXCEPTION?(RPCPA)
A)
B)
C)
D)

TAX
LICENSE FEE
TOLL
EMINENT DOMAIN

65.THE POWER OF THE STATE TO ENACT SUCH LAWS IN RELATION TO
PERSONS AND PROPERTY AS MAY PROMOTE PUBLIC HEALTH, PUBLIC
MORALS, PUBLIC SAFETY, AND THE GENERAL WELFARE OF THE PEOPLE\
A)
B)
C)
D)

POWER OF EMINENT DOMAIN
POLICE POWER
POWER OF TAXATION
PEOPLE POWER


66. THE FOLLOWING ARE SIMILARITIES OF THE INHERENT POWER OF
TAXATION, EMINENT DOMAIN AND POLICE POWER EXCEPT ONE-(RPCPA)
A)
B)
C)
D)

ARE NECESSARY ATTRIBUTES OF SOVEREIGNTY
INTERFERES WITH PRIVATE RIGHTS AND PROPERTY
AFFECTS ALL PERSONS OR THE PUBLIC
ARE LEGISLATIVE IN THEIR IMPLEMENTATION

67. WHICH STATEMENT REFERS TO POLICE POWER AS DISTINGUISHED
FROM TAXATION?-(RPCPA)
A) IT CAN ONLY BE IMPOSED ON SPECIFIC PROPERTY OR PROPERTIES
B) THE AMOUNT IMPOSED DEPENDS ON WHETHER THE ACTIVITY IS
USEFUL OR NOT
C) IT INVOLVES THE TAKING OF PROPERTY BY THE GOVERNMENT
D) THE AMOUNT IMPOSED HAS NO LIMIT
68.POLICE POWER AS DISTINGUISHED FROM TAXATION
A) JUST COMPENSATION IS RECEIVED BY THE OWNER OF THE
PROPERTY
B) MAYBE EXERCISED BY PRIVATE INDIVIDUALS
C) SUPERIOR TO THE NON-IMPAIRMENT CLAUSE OF THE
CONSTITUTION
D) PROPERTY IS TAKEN BY THE GOV’T FOR PUBLIC PURPOSE
69 AFTER HAVING BEEN INFORMED THAT SOME MASSAGE PARLORS ARE
BEING USED AS FRONTS FOR PROSTITUTION, THE SANGGUNIANG
PANLUNGSOD OF MANILA PASSED A TAX ORDINANCE SUBJECTING
MASSAGE PARLORS WITHIN ITS JURISDICTION TO SUCH ONEROUS TAXES
THAT LEAVE THEM NO OTHER ALTERNATIVE BUT TO STOP OPERATING.
THE PASSAGE OF THE ORDINANCE IS A VALID EXERCISE OFA)
B)
C)
D)

TAXATION
EMINENT DOMAIN
POLICE POWER
POLICE POWER AND POWER OF TAXATION

70. STATEMENT 1: THE CONGRESS CAN ENACT TAX LAWS EVEN IN THE
ABSENCE OF A CONSTITUTIONAL PROVISION GRANTING SAID BODY THE
POWER TO TAX.
STATEMENT 2: A TAX MAY BE VALIDLY IMPOSED IN THE EXERCISE OF
POLICE POWER AND NOT THE POWER TO TAX.


A)
B)
C)
D)

FALSE, FALSE
FALSE, TRUE
TRUE, TRUE
TRUE, FALSE

71. WHICH OF THE FOLLOWING MAY NOT RAISE MONEY FOR THE
GOVERNMENT-(RPCPA)
A)
B)
C)
D)

POWER OF TAXATION
POLICE POWER
POWER OF EMINENT DOMAIN
PRIVATIZATION OF GOVERNMENT’S CAPITAL ASSETS

72. IN THIS POWER OF THE STATE, THE PERSON WHO IS PARTING WITH HIS
MONEY OR PROPERTY IS PRESUMED TO RECEIVE A BENEFIT-(RPCPA)
A)
B)
C)
D)

TAXATION
POLICE POWER
EMINENT DOMAIN
FORFEITURE POWER

73. WHICH OF THE INHERENT POWERS OF THE GOVERNMENT IS INFERIOR
TO THE NON-IMPAIRMENT CLAUSE OF THE CONSTITUTION?
A)
B)
C)
D)

TAXATION
POLICE POWER
EMINENT DOMAIN
NONE

74. TAX IS DISTINGUISHED FROM LICENSE FEE-(RPCPA)
A) NON-PAYMENT DOES NOT NECESSARILY RENDER THE BUSINESS
ILLEGAL
B) A REGULATORY MEASURE
C) IMPOSED IN THE EXERCISE OF POLICE POWER
D) LIMITED TO COVER COST OF OBLIGATION
75. THE DISTINCTION OF A TAX FROM PERMIT OR LICENSE FEE IS THAT A
TAX IS-(RPCPA)
A) IMPOSED FOR REGULATION
B) ONE WHICH INVOLVES EXERCISE OF POLICE POWER
C) ONE IN WHICH THERE IS GENERALLY NO LIMIT ON THE AMOUNT
THAT MAY BE IMPOSED
D) ANSWER IS NOT GIVEN


76. WHICH OF THE FOLLOWING TERMS DESCRIBES THIS STATEMENT
“THAT THE STATE HAS COMPLETE DISCRETION ON THE AMOUNT TO BE
IMPOSED AFTER DISTINGUISHING BETWEEN A USEFUL AND NON-USEFUL
ACTIVITY?”-(RPCPA)
A)
B)
C)
D)

TAX
LICENSE FEE
TOLL
CUSTOMS DUTY

77. WHICH OF THE FOLLOWING IS NOT A DISTINCTION OR SIMILARITY OF
LICENSE FEE FROM TAX?-(RPCPA)
A)
B)
C)
D)

IMPOSED NFOR REGULATION
INVOLVES EXERCISE OF POLICE POWER
NON-PAYMENT MAKES THE BUSINESS ILLEGAL
LEGAL COMPENSATION OR REWARD OF AN OFFICER FOR SERVICES

78. ALL OF THE FOLLOWING, EXCEPT ONE, ARE CHARACTERISTICS OF A
TOLL
A)
B)
C)
D)

DEMAND OF PROPRIETORSHIP
COMPENSATION FOR THE USE OF ANOTHER’S PROPERTY
MAY BE IMPOSED BY PRIVATE INDIVIDUALS
LEVIED FOR THE SUPPORT OF THE GOVERNMENT

79. THIS IS A DEMAND OF OWNERSHIP-(RPCPA)
A)
B)
C)
D)

LICENSE FEE
TAX
TOLL
FRANCHISE

80. ONE OF THE FOLLOWING IS NOT A CHARACTERISTIC OF A SPECIAL
ASSESSMENT
A) IT HAS SPECIAL APPLICATION ONLY TO A PARTICULAR TIME AND
PLACE
B) IT IS LEVIED ONLY ON LAND
C) MAY BE LEVIED ON BUSINESS
D) BASED WHOLLY ON BENEFITS
81. WHICH STATEMENT IS WRONG?-(RPCPA)
A) A TAX IS A DEMAND OF SOVEREIGNTY
B) A TOLL IS A DEMAND OF OWNERSHIP


C) A SPECIAL ASSESSMENT IS A TAX
D) CUSTOMS DUTY IS A TAX
82.WHICH OF THE FOLLOWING IS NOT A CHARACTERISTIC OF DEBT?
A)
B)
C)
D)

GENERALLY ARISES FROM CONTRACT
PAYABLE ONLY IN MONEY
ASSIGNABLE
IMPRISONMENT IS NOT A SANCTION FOR NON-PAYMENT

83. ALL FUNDS OR INCOME DERIVED BY THE GOVERNMENT FROM ANY
OTHER SOURC E
A)
B)
C)
D)

TAX
CUSTOMS DUTY
REVENUE
ORDINARY INCOME

84. IT COMPRISES ALL KINDS OF FUNDS INCLUDING TAXES-(RPCPA)
A)
B)
C)
D)

LICENSE FEE
INCOME
CUSTOMS DUTY
REVENUE

85.WHICH OF THE FOLLOWING CONSTITUTE OBJECTIONABLE DOUBLE
TAXATION?-(RPCPA)
A) A LICENSE FEE AND A TAX IMPOSED ON THE SAME BUSINESS OR
OCCUPATION FOR SELLING THE SAME ARTICLES
B) A TAX IMPOSED BOTH ON THE OCCUPATION OF FISHING AND ON
FISHPOND OPERATION
C) PERSONS ENGAGED IN LEASING OR SELLING REAL PROPERTY ARE
SUBJECT TO REAL ESTATE DEALERS TAX AND THEIR SALES ARE
ALSO SUBJECT TO 12% VAT
D) A TAX OF 1% IS IMPOSED FOR BANK RESERVE DEFICIENCY WHILE A
PENALTY OF 1/10 OF 1% IS ALSO IMPOSED AS A CONSEQUENCE OF
SUCH RESERVE DEFICIENCY
86. WHICH OF THE FOLLOWING IS NOT AN ELEMENT OF DIRECT
DUPLICATE TAXATION WHICH IS VIOLATIVE OF THE EQUAL
PROTECTIONAND UNIFORMITY CLAUSES IN THE CONSTITUTION?
A) SAME PROPERTY IS TAXED TWICE
B) SAME TAXING AUTHORITY
C) SAME AMOUNT


D) SAME PURPOSE
87. THE FOLLOWING CONSTITUTE DOUBLE TAXATION EXCEPT ONE(RPCPA)
A)
B)
C)
D)

BOTH TAXES ARE IMPOSED IN THE SAME AMOUNT
BOTH TAXES ARE LEVIED FOR THE SAME PURPOSE
BOTH TAXES ARE IMPOSED BY THE SAME TAXING AUTHORITY
BOTH TAXES ARE IMPOSED UPON THE SAME PERSON

88. STATEMENT 1: OUR CONSTITUTION DOES NOT PROHIBIT DOUBLE
TAXATION
STATEMENT 2: IF DOUBLE TAXATION OCCURS, THE TAXPAYER MAY SEEK
RELIEF UNDER THE UNIFORMITY CLAUSE OR THE EQUAL PROTECTION
GUARANTEE-(RPCPA)
A)
B)
C)
D)

CORRECT, WRONG
WRONG, CORRECT
WRONG, WRONG
CORRECT, CORRECT

89. YOUR CLIENT OWNS A ROW OF APARTMENTS. HE COMPLAINS TO YOU
THAT HE IS BEING REQUIRED TO PAY FOUR (4) KINDS OF TAXES ON THIS
LINE OF BUSINESS ALONE. FROM THE LIST GIVEN BY YOUR CLIENT,
WHICH OF THE FOLLOWING TAXES HAS BEEN WRONGLY IMPOSED ON
HIM?
A) REAL ESTATE TAX ON THE LAND AND BUILDING
B) VALUE-ADDED TAX ON THE GROSS RECEIPTS FROM RENT
C) COMMUNITY TAX BASED ON THE ASSESSED VALUE OF THE
APARTMENT HOUSE
D) INCOME TAX ON INCOME FROM RENT
90. ONE OF THE FOLLOWING IS A FALSE STATEMENT ABOUT DOUBLE
TAXATION. WHICH IS IT?
A) THERE IS NO CONSTITUTIONAL PROHIBITION ON DOUBLE
TAXATION
B) DIRECT DUPLICATE TAXATION IS A VALID DEFENSE AGAINST A TAX
MEASURE IF IT IS VIOLATIVE OF THE EQUAL PROTECTION CLAUSE
C) ABSENCE OF ANY OF THE ELEMENTS OF DIRECT DOUBLE TAXATION
MAKES IT INDIRECT DUPLICATE TAXATION
D) A 20% FINAL WITHHOLDING TAX ON INTEREST INCOME ON BANK
DEPOSITS AND A 5% GROSS RECEIPTS TAX ON BANKS IS A DIRECT
DUPLICATE TAXATION


91. TRANSFER OF THE TAX BURDEN BY ONE ON WHOM THE TAX IS
ASSESSED TO ANOTHER
A)
B)
C)
D)

SHIFTING
CAPITALIZATION
TRANSFORMATION
TAX EXEMPTION

92. WHICH OF THE FOLLOWING IS NOT A SCHEME OF SHIFTING THE
INCIDENCE OF TAX BURDEN?-(RPCPA)
A) THE MANUFACTURER TRANSFERS THE TAX TO THE CONSUMER BY
ADDING THE TAX TO THE SELLING PRICE OF THE GOODS SOLD
B) THE PURCHASER ASKS FOR A DISCOUNT OR REFUSE TO BUY AT
REGULAR PRICE UNLESS IT IS REDUCED BY AN AMOUNT EQUAL TO
THE TAX HE WILL PAY
C) CHANGING THE TERMS OF THE SALE LIKE FOB SHIPPING POINT IN
THE PHILIPPINES TO FOB DESTINATION ABROAD, SO THAT THE
TITLE PASSES ABROAD INSTEAD OF IN THE PHILIPPINES
D) THE MANUFACTURER TRANSFERS THE SALES TAX TO THE
DISTRIBUTOR, THEN IN TURN TO THE WHOLESALER, TO THE
RETAILER AND FINALLY TO THE CONSUMER
93. THE REDUCTION IN THE SELLING PRICE OF INCOME-PRODUCING
PROPERTY BY AN AMOUNT EQUAL TO THE CAPITALIZED VALUE OF
FUTURE TAXES THAT MAY BE PAID BY THE PURCHASER
A)
B)
C)
D)

SHIFTING
CAPITALIZATION
TRANSFORMATION
TAX EXEMPTION

94. THE METHOD BY WHICH THE MANUFACTURER OR PRODUCER UPON
WHOM THE TAX IS IMPOSED PAYS THE TAX AND STRIVES TO RECOVER
SUCH EXPENSE THROUGH LOWER PRODUCTION COST WITHOUT
SACRIFICING THE QUALITY OF HIS PRODUCT
A)
B)
C)
D)

SHIFTING
CAPITALIZATION
TRANSFORMATION
TAX EXEMPTION

95. THE GRANT OF IMMUNITY TO PARTICULAR PERSONS OR CORPORATION
OR TO PERSONS OR CORPORATIONS OF A PARTICULAR CLASS FROM A TAX
WHICH PERSONS AND CORPORATIONS GENERALLY WITHIN THE SAME
TAXING DISTRICT ARE OBLIGED TO PAY


A)
B)
C)
D)

TAX EXEMPTION
TAX EVASION
TAX AVOIDANCE
TAX AMNESTY

96. STATEMENT 1: A BIR RULING ISSUED BY A COMMISSIONER OF
INTERNAL REVENUE WHICH GRANTS TAX EXEMPTION WOULD CREATEA
PERPETUAL EXEMPTION IN FAVOR OF THE TAXPAYER
STATEMENT 2: A TAX EXEMPTION MAY BE WITHDRAWN ANYTIME AT THE
PLEASURE OF THE TAXING AUTHORITY
WHICH OF THE ABOVE STATEMENTS IS TRUE?
A)
B)
C)
D)

STATEMENT 1 ONLY
STATEMENTS 1 AND 2
STATEMENT 2 ONLY
NEITHER OF THEM

97. IT IS ALSO KNOWN AS TAX DODGING
A)
B)
C)
D)

TAX EXEMPTION
TAX EVASION
TAX AVOIDANCE
TRANSFORMATION

98. IT IS ALSO KNOWN AS TAX MINIMIZATION
A)
B)
C)
D)

TAX EXEMPTION
TAX EVASION
TAX AVOIDANCE
TRANSFORMATION

99. WHICH OF
AVOIDANCE?

THE

FOLLOWING

STATEMENTS

CONSTITUTE

TAX

A) DELIBERATE FAILURE OF A TAXPAYER TO PAY THE TAXES DUE TO
THE GOVERNMENT
B) CONNOTES FRAUD THROUGH THE USE OF PRETENSES AND
FORBIDDEN DEVICES TO LESSEN OR DEFEAT TAXES
C) PUNISHABLE BY LAW
D) MAYBE CONTRARY TO THE INTENT OF THE LEGISLATURE BUT
NEVERTHELESS DO NOT VIOLATE THE LAW


100. WHICH OF THE FOLLOWING FACTS PERTAIN/S TO TAX AVOIDANCE?
I.AFTER STUDYING HIS TAX PROBLEMS, MATALINO DECIDED TO
WITHDRAW HIS BANK DEPOSITS AND TO BUY TAX-EXEMPT SECURITIES
II.TUSO WHO WISHES TO AVOID THE PAYMENT OF TAXES ASSESSABLE
ON THE TRANSACTION MADE IT APPEAR ON THE DEED OF SALE THAT
THE SELLING PRICE WAS ONLY P200,000 ALTHOUGH IT WAS ACTUALLY
P300,000
III.REFRAINING FROM ENGAGING IN ACTIVITES SUBJECT TO TAX
IV.ABUSADO INSURANCE CORPORATION SOLD ITS OFFICE BUILDING TO
ADAN FOR P100 MILLION, WHO IN TURN, SOLD THE SAME PROPERTY TO
DUGONG-BUGHAW, INC. FOR P200 MILLION. THESE 2 TRANSACTIONS
WERE EVIDENCED BTY DEEDS OF ABSOLUTE SALE NOTARIZED ON THE
SAME DAY BY THE SAME NOTARY PUBLIC.
A)
B)
C)
D)

I ONLY
I AND III ONLY
I AND IV
I, III AND IV

101. IN CASE OF AMBIGUITY, TAX LAWS SHALL BE INTERPRETED
A)
B)
C)
D)

STRICTLY AGAINST THE TAXPAYER
LIBERALLY AGAINST THE POWER
LIBERALLY IN FAVOR OF THE TAXPAYER
LIBERALLY IN FAVOR OF THE GOVERNMENT

102. IN CASES OF DEDUCTIONS AND EXEMPTIONS ON INCOME TAX
RETURNS, DOUBTS SHALL BE RESOLVED-(RPCPA)
A)
B)
C)
D)

STRICTLY AGAINST THE TAXPAYER
STRICTLY AGAINST THE GOVERNMENT
LIBERALLY IN FAVOR OF THE TAXPAYER
LIBERALLY AGAINST THE GOVERNMENT

103. THE FOLLOWING, EXCEPT ONE, ARE EXCEPTIONS TO THE RULE THAT
TAX EXEMPTIONS MUST BE STRICTLY CONSTRUED AGAINST THE
TAXPAYER
A) WHERE THE STATUTE GRANTING THE EXEMPTION PROVIDES FOR
LIBERAL INTERPRETATION THEREOF
B) IF THE TAXPAYER DOES NOT FALL WITHIN THE PURVIEW OF THE
EXCEPTION BY CLEAR LEGISLATIVE INTENT
C) IN CASE OF SPECIAL TAXES RELATING TO SPECIAL CASES AND
AFFECTING ONLY SPECIAL CLASSES OF PERSONS
D) IF EXMPTIONS REFER TO PUBLIC PROPERTY


104. A FRANCHISE CAN BE AMENDED BY-(RPCPA)
A) AN AMENDMENT OF SPECIAL LAW, WHICH GRANTED
FRANCHISE
B) AN AMENDMENT OF A LAW OF GENERAL APPLICATION
C) AN AMENDMENT OF A REVENUE REGULATION
D) AN AMENDMENT OF TAX LAWS

THE

105. SOME FRANCHISE HOLDERS WHO ARE PAYING THE FRANCHISE TAX
ARE BEING REQUIRED BY AN AMENDATORY LAW TO PAY THE VALUEADDED TAX, WHILE OTHERS REMAIN SUBJECT TO FRANCHISE TAX. WHICH
OF THE FOLLOWING CONSTITUTIONAL PROVISION MAKES THE LAW
UNCONSTITUTIONAL?-(RPCPA)
A) NO LAW SHALL BE PASSED IMPAIRING THE OBLIGATION OF
CONTRACT
B) THE RULE OF TAXATION SHALL BE UNIFORM
C) NO PERSON SHALL BE DEPRIVED OF PROPERTY WITHOUT DUE
PROCESS OF LAW
D) NONE OF THE ABOVE
106. STATEMENT 1: THE POINT ON WHICH A TAX IS ORIGINALLY IMPOSED
IS IMPACT OF TAXATION
STATEMENT 2: AS A RULE, TAXES ARE SUBJECT TO SET-OFF OR
COMPENSATION
A)
B)
C)
D)

TRUE, TRUE
FALSE, TRUE
FALSE, FALSE
TRUE, FALSE

107. WHICH OF THE FOLLOWING IS NOT CONSIDERED AS A STEP IN
MAKING A REVENUE REGULATION EFFECTIVE?
A) RECOMMENDATION BY THE COMMISSIONER OF INTERNAL
REVENUE TO THE SECRETARY OF FINANCE
B) APPROVAL BY THE SECRETARY OF FINANCE
C) LEGISLATION BY CONGRESS
D) PUBLICATION IN A NEWSPAPER OF GENERAL CIRCULATION
108. STATEMENT 1: IN CASE OF CONFLICT BETWEEN A REVENUE
REGULATION AND THE PROVISIONS OF THE NATIONAL INTERNAL
REVENUE CODE, THE LATTER SHALL PREVAIL


STATEMENT 2: THE REVOCATION OF A REVENUE REGULATION CAN NOT
BE MADE RETROACTIVE EVEN IF THE REASON FOR ITS REVOCATION IS
THAT IT IS ERRONEOUS OR CONTRARY TO LAW
A)
B)
C)
D)

CORRECT, WRONG
CORRECT, CORRECT
WRONG, CORRECT
WRONG, WRONG

109. ALL OF THE FOLLOWING, EXCEPT ONE, ARE SOURCES OF TAX LAWSA)
B)
C)
D)

LEGISLATIONS, TAX TREATIES AND TAX ORDINANCES
JUDICIAL DECISIONS
OPINIONS OF AUTHORS
ADMINISTRATIVE RULES AND REGULATIONS

110. THE LEAST SOURCE OF TAX LAW ISA)
B)
C)
D)

STATUTES
COURT DECISIONS
CONSTITUTION
BIR RULINGS

111. WHEN THE REFUND OF A TAX SUPPOSEDLY DUE TO THE TAXPAYER
HAS ALREADY BEEN BARRED BY PRESCRIPTION, AND THE SAID
TAXPAYER IS ASSESSED WITH A TAX AT PRESENT, THE TWO CASES MAY
BE SET-OFF WITH EACH OTHER. THIS DOCTRINE IS CALLED
A)
B)
C)
D)

SET-OFF DOCTRINE
DOCTRINE OF RECIPROCITY
TAX SPARING DOCTRINE
EQUITAB LE RECOUPMENT

112. STATEMENT 1: THE DOCTRINE OF EQUITABLE IS APPLICABLE IN THE
PHILIPPINES
STATEMENT 2: WHERE TAXES AND THE CLAIM OF THE TAXPAYER ARE
FULLY LIQUIDATED, DUE AND DEMANDABLE, SET-OFF OR LEGAL
COMPENSATION MAY TAKE PLACE BY OPERATION OF LAW
A)
B)
C)
D)

CORRECT, WRONG
CORRECT, CORRECT
WRONG, CORRECT
WRONG, WRONG


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