General Principles Of Taxation Trivia Quiz
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Here is an amazing test, general principles of taxation trivia quiz. This quiz has been designed carefully and will guide you through the gamut of the entire basics of taxation and how you should go about it. If you are already knowledgeable about it, just treat it like a refresher course! Who knows, you might even pick up something new. Let's dive right in and begin the quiz! All the best!.
- 1.
Which of the following is/are the nature of the power of taxation?
- It is an inherent attribute of sovereignty.
- It is legislative in character.
- It is regarded as comprehensive, unlimited, plenary and supreme.
- A.
A. I only.
- B.
B. I and II only.
- C.
C. II and III only.
- D.
D. I and III only.
Correct Answer
B. B. I and II only.Explanation
Answer: B III is the extent of the power of taxation not its nature.Rate this question:
- 2.
A characteristic of taxes which means taxes are assessed with some reasonable rule of apportionment
- A.
Due process
- B.
Equal protection
- C.
Theoretical justice
- D.
Uniformity
Correct Answer
C. Theoretical justiceExplanation
Theoretical justiceRate this question:
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- 3.
Under the benefits-protection/reciprocity theory, while taxes are intended for general benefits, special benefits to taxpayers are not required.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Answer: A. TrueRate this question:
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- 4.
Which of the following statements is true on the power of the courts of judicial review in taxation? I.It is within the province of the courts to inquire into the wisdom or policy of the exaction, the motives behind it, the amount to be raised or the persons, property, or other privileges to be taxed. II. The court’s power in taxation is limited only to the application and interpretation of the law. III. The principle of judicial non-interference does not extend to the administrative realm.
- A.
A. II and III only
- B.
B. I and III only
- C.
C. II only
- D.
D. I and II only
Correct Answer
C. C. II onlyExplanation
ANSWER: C. II only It is not within the province of the courts to inquire into the wisdom or policy of the exaction, the motives behind it, the amount to be raised or the persons, property, or other privileges to be taxed. The principle of judicial non-interference extends to the administrative realm.Rate this question:
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- 5.
In which of the following powers of the state does the taxpayer receive a direct benefit?
- A.
Taxation
- B.
Police power
- C.
Eminent domain
- D.
None of the above.
Correct Answer
C. Eminent domainExplanation
Answer: C. Eminent domain In the power of an eminent domain, a direct benefit results in the form of just compensation to the property owner.Rate this question:
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- 6.
Which of the following powers of the state is superior to the non-impairment clause of contracts?
- Taxation
- Police power
- Eminent domain
- A.
A. I only
- B.
B. I and II only
- C.
C. I and III only
- D.
D. II and III only
Correct Answer
D. D. II and III onlyExplanation
Answer: D The power to tax is not superior to the non-impairment clause.Rate this question:
- 7.
Motor vehicle registration fees are now considered revenue or tax measures.
- A.
A. True
- B.
B. False
Correct Answer
A. A. TrueExplanation
Answer: A. TrueRate this question:
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- 8.
Which of the following statements on construction of tax laws is false?
- A.
A statute will not be construed as imposing a tax unless it does so clearly, expressly and unambiguously.
- B.
In case of doubt, it is construed most strongly against the Government, and liberally in favor of the taxpayer.
- C.
Tax laws are special laws and prevail over a general law.
- D.
The retroactive application of tax laws is not permitted.
Correct Answer
D. The retroactive application of tax laws is not permitted.Explanation
ANSWER: D Tax laws operate prospectively unless the purpose of the legislature to give retrospective effect is expressly declared or may be implied from the language used.Rate this question:
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- 9.
I. Tax laws are political in character. II. Tax laws are civil in nature. III. Tax laws are not penal in character. Which of the above statements is/are true?
- A.
A. I and II only
- B.
B. II and III only
- C.
C. I and III only
- D.
D. II only
Correct Answer
B. B. II and III onlyExplanation
Answer: B
Tax laws are not political in nature.Rate this question:
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- 10.
Which of the following statements is/are true?
- Taxes are personal to the taxpayer.
- Stockholders may be held liable for unpaid taxes of a dissolved corporation.
- A corporation’s tax delinquency cannot be enforced against its stockholders.
- A.
A. I only
- B.
B. I and II only
- C.
C. I and III only
- D.
D. I, II and III
Correct Answer
D. D. I, II and IIIExplanation
Answer: D
TAXES ARE PERSONAL TO THE TAXPAYER
A corporation’s tax delinquency cannot be enforced against its stockholders. (Corporate Entity Doctrine)
Exception: Stockholders may be held liable for unpaid taxes of a dissolved corporation:
a. if it appears that the corporate assets have passed into their hands or
b. when the stockholders have unpaid subscriptions to the capital of the corporationRate this question:
- 11.
Tax upon the value of the article or thing subject to taxation; the intervention of another party is needed for the computation of the tax.
- A.
A. Customs duties
- B.
B. Specific tax
- C.
C. Ad valorem tax
- D.
D. Special tax
Correct Answer
C. C. Ad valorem taxExplanation
Answer: C.Rate this question:
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- 12.
Which of the following is not considered tax?
- A.
A. Compromise penalty
- B.
B. Special assessment
- C.
C. License or fee
- D.
D. All of the above
Correct Answer
D. D. All of the aboveExplanation
Answer: DRate this question:
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- 13.
Which of the following is not a requisite of taxpayer’s suit?
- A.
A. The tax money is being extracted and spent in violation of specific constitutional protections against abuses of legislative power.
- B.
B. That public money is being deflected to any improper purpose
- C.
C. That the petitioner seeks to restrain respondents from wasting public funds through the enforcement of an invalid or unconstitutional law
- D.
D. None of the above.
Correct Answer
D. D. None of the above.Explanation
Answer: DRate this question:
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- 14.
Which of the following is not an inherent limitation of the power to tax?
- A.
A. Non-delegability of the taxing power
- B.
B. Public purpose of taxes
- C.
C. Tax Exemption of the government
- D.
D. None of the above.
Correct Answer
D. D. None of the above.Explanation
Answer: D
A. INHERENT LIMITATIONS (KEY: SPINE)
1. Territoriality or Situs of taxation
2. Public purpose of taxes
3. International comity
4. Non-delegability of the taxing power
5. Tax Exemption of the governmentRate this question:
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- 15.
I. The power of taxation is peculiarly and exclusively exercised by the legislature.II. The President has the authority to fix tariff rates, import and export quotas, tonnage and wharfage dues, and other duties or imposts.III. Local government units have the power to levy taxes, fees, and charges.IV. Tax legislation may be delegated to administrative agencies. Which of the above statements is/are false?
- A.
A. II and IV only
- B.
B. II and III only
- C.
C. II, III and IV only
- D.
D. IV only
Correct Answer
D. D. IV onlyExplanation
Answer: D. IV onlyRate this question:
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- 16.
Shares, obligations or bonds by any foreign corporation are only includible in the gross estate of a resident decedent when
- A.
A. 50% of the business of the foreign corporation is located in the Philippines
- B.
B. 70% of the business of the foreign corporation is located in the Philippines
- C.
C. 85% of the business of the foreign corporation is located in the Philippines
- D.
D. 90% of the business of the foreign corporation is located in the Philippines
Correct Answer
C. C. 85% of the business of the foreign corporation is located in the PhilippinesExplanation
Answer: C.Rate this question:
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- 17.
I. Although the government is tax exempt, it can however tax itself.II. GOCCs’ income is taxable at special rates.
- A.
A. Statement I is true; Statement II is false
- B.
B. Statement I is false; Statement II is true
- C.
C. Both statements are true
- D.
D. Both statements are false
Correct Answer
A. A. Statement I is true; Statement II is falseExplanation
Answer: A.
GOCCs
General Rule: Income is taxable at the rate imposed upon corporations or associations engaged in a similar business, industry, or activity.Rate this question:
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- 18.
I. Property actually, directly and exclusively used for educational purposes by government educational institutions are exempt from property or real property tax.II. Income of whatever kind and character from any properties of government educational institutions, real or personal, regardless of the disposition, is taxable.
- A.
A. Statement I is true; Statement II is false
- B.
B. Statement I is false; Statement II is true
- C.
C. Both statements are true
- D.
D. Both statements are false
Correct Answer
C. C. Both statements are trueExplanation
Answer: CRate this question:
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- 19.
I. Donations in favor of governmental institutions are considered as income on the part of the done.II. However, it is not considered as taxable income because it is an exclusion from the computation of gross income.
- A.
A. Statement I is true; Statement II is false
- B.
B. Statement I is false; Statement II is true
- C.
C. Both statements are true
- D.
D. Both statements are false
Correct Answer
C. C. Both statements are trueExplanation
Answer: CRate this question:
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- 20.
Which of the following may be subject to tax imposed by the local government units?
- A.
A. A GOCC
- B.
B. Local water districts
- C.
C. Cooperatives duly registered under RA No. 6938
- D.
D. Non-stock and non-profit institutions
Correct Answer
A. A. A GOCCExplanation
Answer: A
Unless otherwise provided in the Local Government Code (LGC), tax exemptions granted to all persons, whether natural or juridical, including GOCC, except local water districts, cooperatives duly registered under RA No. 6938, non-stock and non-profit institutions, are withdrawn upon effectivity of the LGC. (Sec. 193, LGC)Rate this question:
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- 21.
I. The principle of international comity limits the authority of the government to effectively impose taxes on a sovereign state and its instrumentalities, as well as on its property held and activities undertaken in that capacity.II. International comity may not apply when one enters the territory of another.
- A.
A. Statement I is true; Statement II is false
- B.
B. Statement I is false; Statement II is true
- C.
C. Both statements are true
- D.
D. Both statements are false
Correct Answer
A. A. Statement I is true; Statement II is falseExplanation
Answer: A
Even where one enters the territory of another, there is an implied understanding that the former does not thereby submit itself to the authority and jurisdiction of the other.Rate this question:
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- 22.
In which of the following circumstances is the non-impairment clause of contracts violated when withdrawn?
- Tax exemption bilaterally agreed by the government and the taxpayer
- Tax exemption unilaterally granted by law, withdrawn by virtue of another law
- Tax exemption granted under a franchise
- A.
A. I only
- B.
B. I and III only
- C.
C. I and II only
- D.
D. I, II and III
Correct Answer
A. A. I onlyExplanation
Answer: A
When the exemption is granted under a franchise – it may be withdrawn at any time thus, not a violation of the non-impairment of contracts.Rate this question:
- 23.
I. In the Philippines, a tax law adopting a regressive system of taxation is unconstitutional.II. Income tax on individual is an example of a progressive system of taxation.
- A.
A. Statement I is true; Statement II is false
- B.
B. Statement I is false; Statement II is true
- C.
C. Both statements are true
- D.
D. Both statements are false
Correct Answer
B. B. Statement I is false; Statement II is trueExplanation
Answer: B
The Constitution does not really prohibit the imposition of indirect taxes which, like the VAT, are regressive. The Constitutional provision means simply that indirect taxes shall be minimized. The mandate to Congress is not to prescribe, but to evolve, a progressive tax system.Rate this question:
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- 24.
Which of the following taxes are non-stock non-profit educational institutions exempt?
- A.
A. Income tax
- B.
B. Customs duties
- C.
C. Property tax
- D.
D. All of the above.
Correct Answer
D. D. All of the above.Explanation
Answer: DRate this question:
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- 25.
Which of the following taxes are religious, educational, charitable institutions exempt?
- A.
A. Income tax
- B.
B. Customs duties
- C.
C. Property tax
- D.
D. All of the above.
Correct Answer
C. C. Property taxExplanation
Answer: C
Religious, educational, and charitable institutions are exempt from property tax only.Rate this question:
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- 26.
Which of the following is not an element of direct double taxation?
- A.
A. both taxes are levied for the same purpose
- B.
B. imposed by the same taxing authority
- C.
C. imposed at the same amount
- D.
D. imposed during the same taxing period
Correct Answer
C. C. imposed at the same amountExplanation
Answer: C
Elements:
a. the same property or subject matter is taxed twice when it should be taxed only once.
b. both taxes are levied for the same purpose
c. imposed by the same taxing authority
d. within the same jurisdiction
e. during the same taxing period
f. covering the same kind or character of tax.
The absence of one or more of the above-mentioned elements makes the double taxation indirect.Rate this question:
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- 27.
It is also known as impact of taxation
- A.
A. Tax imposition
- B.
B. Tax collection
- C.
C. Tax evasion
- D.
D. Tax avoidance
Correct Answer
A. A. Tax impositionExplanation
Answer: ARate this question:
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- 28.
A grant of immunity to particular persons or corporations from the obligation to pay taxes
- A.
Tax amnesty
- B.
Tax exemption
- C.
Tax avoidance
- D.
Tax evasion
Correct Answer
B. Tax exemptionExplanation
Answer: BRate this question:
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- 29.
Vote needed in Congress to grant tax exemption
- A.
1/3 of all the members of Congress
- B.
2/3 of all the members of Congress
- C.
Majority of all the members of Congress
- D.
A unanimous vote of all members of Congress.
Correct Answer
C. Majority of all the members of CongressExplanation
Answer: CRate this question:
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- 30.
Which of the following is not of the nature of tax exemption?
- A.
Deductions for income tax purposes
- B.
Claims for refund
- C.
Tax credits
- D.
Tax amnesty
Correct Answer
C. Tax creditsExplanation
Answer: CRate this question:
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