Welcome to Scribd, the world's digital library. Read, publish, and share books and documents. See more
Download
Standard view
Full view
of .
Save to My Library
Look up keyword
Like this
7Activity
0 of .
Results for:
No results containing your search query
P. 1
Taxation 101 Basic Principles in Philippine Taxation by JR Lopez Gonzales

Taxation 101 Basic Principles in Philippine Taxation by JR Lopez Gonzales

Ratings: (0)|Views: 3,756|Likes:
Published by jrgon_zales
This document is uploaded by PoliTikalon Blog: http://www.politikalon.blogspot.com.

The reading of this note is advised to be coupled with the downloadable PowerPoint presentation at: http://www.slideshare.net/JRLopezGonzales/taxation-101-basic-rules-and-principles-in-philippine-taxation-by-jr-lopez-gonzales-for-msu-iit-political-science-seminar.
This document is uploaded by PoliTikalon Blog: http://www.politikalon.blogspot.com.

The reading of this note is advised to be coupled with the downloadable PowerPoint presentation at: http://www.slideshare.net/JRLopezGonzales/taxation-101-basic-rules-and-principles-in-philippine-taxation-by-jr-lopez-gonzales-for-msu-iit-political-science-seminar.

More info:

Published by: jrgon_zales on Aug 11, 2011
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as DOCX, PDF, TXT or read online from Scribd
See more
See less

11/28/2013

pdf

text

original

 
1
This document is uploaded by PoliTikalon Blog:http://www.politikalon.blogspot.com.The reading of this note is advised to be coupled with the downloadable PowerPoint presentation at:http://www.slideshare.net/JRLopezGonzales/taxation-101-basic-rules-and-principles-in-philippine-taxation-by-jr-lopez-gonzales-for-msu-iit-political-science-seminar .
Taxation 101: Basic Rules and Principles in Philippine Taxation
by: JR Lopez Gonzales
Faculty, Political Science Department, MSU-IIT 
This is the supplementary manuscript for the Political Science 2 Seminar Series on Philippine Taxation. Ina nutshell, this document summarizes some of the basic rules, its nature, and purpose of taxation. A brief history of Philippine tax system, and those institutions exempted for paying taxes is also included.
Taxation
Taxation is the imposition of financial charges or other levies, upon a taxpayer (anindividual or legal entity) by a state such that failure to pay is punishable by law.
 
When taxes are not fully paid, civil penalties (such as fines or forfeiture) or criminalpenalties (such as incarceration) may be imposed on the non-paying entity or individual.It is a mode by which government make exactions for revenue in order to support their existence and carry out their legitimate objectives (Tax Law and Jurisprudence by Justice Vitug,2000).It is the inherent power by which the sovereign state imposes financial burden uponpersons and property as a means of raising revenues in order to defray the necessary expensesof the government (Tax Digest by Crescencio Co Untian 2002 ed).Nonetheless, it is the most pervasive and the strongest of all the powers of thegovernment. Taxes are the lifeblood of the government, without which, it cannot subsist.
History of Taxation
The first known system of taxation was in Ancient Egypt around 3000 BC - 2800 BC inthe first dynasty of the Old Kingdom.In Biblical times, tax is already prevalent. According to Genesis 47:24:
³B
ut when thecrop comes in, give a fifth of it to Pharaoh. The other four-fifths you may keep as seed for thefields and as food for yourselves and your households and your children´.
Earliest taxes in Rome are called as portoria were customs duties on imports andexports. Augustus Caesar introduced the inheritance tax to provide retirement funds for themilitary. The tax was five percent on all inheritances except gifts to children and spouses .In England, taxes were first used as emergency measures.
History of Taxation in the Philippines
The pre-colonial society, being communitarian, did not have taxes. But this radically changedupon the coming of the Spanish colonizers in 1521.
 
2
 
This document is uploaded by PoliTikalon Blog:http://www.politikalon.blogspot.com.The reading of this note is advised to be coupled with the downloadable PowerPoint presentation at:http://www.slideshare.net/JRLopezGonzales/taxation-101-basic-rules-and-principles-in-philippine-taxation-by-jr-lopez-gonzales-for-msu-iit-political-science-seminar .
During the Spanish Period, revolutionary income-generating means were introduced bythe government.
Polo Y Servicio
(Forced Labor)
It is the forced labor for 40 days of men ranging from 16 to 60 years of age who wereobligated to give personal services to community projects. One could be exempted from thepolo by paying a fee called
falla (which was worth one and a half real)
. Falla is a corruption of the Spanish word
falta
which means ³absence´.
M
anila-Acapulco Galleon Trade
The Manila-Acapulco Galleon Trade was the main source of income for the colonyduring its early years. Service was inaugurated in 1565 and continued into the early 19thcentury. The Galleon trade brought silver from New Spain and silk from China by way of Manila.This way, the Philippines earned its income through buy and sell - that is, they bought silk fromChina for resale to New Spain and then bought American silver for resale to China.However, it resulted in cultural and commercial exchanges between Asia and the Americas that led to the introduction of new crops and animals to the Philippines notablytobacco that gave the colony its first real income which benefit extended to the common Indio.The trade lasted for over two hundred years, and ceased in 1821 with the secession of  American colonies from Spain.
En
comie
nda
 
The
encomienda
system was introduced in 1570. It was introduced by the Spaniards tofacilitate the conquest and pacification of the Philippines. It comes from the word,
encomendar 
which means ³to take charge of´ or ³to entrust´. The
encomenderos
were given full authority tomanage the encomienda by collecting tribute from the inhabitants and govern people living on it.In 1591, there were 267 encomiendas in the Philippines.
Tribute
Tribute was the residence tax during the Spanish times. It may be paid in cash or kind,partly, or wholly. The rate was originally set as eight
reales
but was raised to ten in 1602 then totwelve reales in 1851 and 14 in 1874. In 1884, the tribute was replaced by the cedula personalor personal identity paper, equivalent to the present residence tax or community tax certificate(CTC).
W
hat is a ³cedula´?
In the 19th century, it was an identification card that had to be carried at all times. Aperson who could not present his or her cedula to a guardia civil could then be detained for being ³indocumentado´. Andres Bonifacio and other Katipuneros tore their cedulas in August1896, signaling the start of the Philippine Revolution.On its present usage, a
cedula
or community tax certificate is a legal identity documentin the Philippines. Issued by cities and municipalities to all persons that have reached the age of majority and upon payment of a community tax, it is considered as a primary form of identification in the Philippines and is one of the closest single documents the Philippines has toa national system of identification, akin to a driver's license and a passport.
 
3
 
This document is uploaded by PoliTikalon Blog:http://www.politikalon.blogspot.com.The reading of this note is advised to be coupled with the downloadable PowerPoint presentation at:http://www.slideshare.net/JRLopezGonzales/taxation-101-basic-rules-and-principles-in-philippine-taxation-by-jr-lopez-gonzales-for-msu-iit-political-science-seminar .
The residence tax, and in turn, the
cédula
, were abolished with the coming of American rule. Nosuch tax would be imposed again until January 1, 1940, when Commonwealth Act No. 465 wentinto effect, mandating the imposition of a base residence tax of fifty centavos and an additionaltax of one peso based on factors such as income and real estate holdings. The payment of thistax would merit the issue of a residence certificate. However, persons who are ineligible to paythe residence tax may be issued a certificate for twenty centavos. Corporations were alsosubject to the residence tax.Significant amendments to the residence tax law were put into effect first in 1973,following the enactment of the Local Tax Code, with amendments on the allocation of theresidence tax and on who are covered under it, as well as payment provisions.The cedula has evolved into the community tax certificate under the Local GovernmentCode of 1991. The code authorizes cities and municipalities to collect annual community taxfrom corporations, and from residents aged 18 and above who have been employed on a wagebasis for at least 30 consecutive days, or who are engaged in business, or who are required bylaw to file an income tax return.
W
hy is the cedula important?
 A person is required to present a cedula when he or she acknowledges a documentbefore a notary public; takes an oath of office upon election or appointment to a governmentposition; receives a license, certificate or permit from a public authority; pays a tax or fee;receives money from a public fund; transacts official business; or receives salary from a personor corporation.
The Four R¶s of Taxation
Taxation has four main purposes or effects:
eve
nu 
e
The taxes raise money to spend on armies, roads, schools and hospitals, and on moreindirect government functions like market regulation or legal systems.
eprici 
ng 
 
Taxes are levied to address externalities; for example, tobacco is taxed to discouragesmoking, and a carbon tax discourages use of carbon-based fuels.
e
istrib
tio
n
 
Normally, this means transferring wealth from the richer sections of society to poorer sections.
eprese
n
a
tio
n
 
The American revolutionary slogan "no taxation without representation" implied this:rulers tax citizens, and citizens demand accountability from their rulers as the other part of thisbargain. Studies have shown that direct taxation (such as income taxes) generates the greatestdegree of accountability and better governance, while indirect taxation tends to have smaller effects.

Activity (7)

You've already reviewed this. Edit your review.
1 thousand reads
1 hundred reads
vocks_2000 liked this
Red Loreno liked this
Norhana Manas liked this

You're Reading a Free Preview

Download
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->