Questions

1. To provide funds or property with which to b. Congress of the Philippines

promote the general welfare and protection of its c. The Executive Department
citizens and to enable it to finance public d. The Judiciary
expenditure is the:
a. Importance of taxation 11. The actual effort exerted by the government to
b. Lifeblood theory effect the exaction of what is due from the
c. Primary purpose of taxation taxpayer is known as
d. Secondary purpose of taxation a. assessment
b. collection
2. The primary purpose of taxation is to: c. levy
a. Prevent inflation d. payment
b. Protect local industries
c. Provide revenue for the State 12. The imposition of tax by the legislature is called:
d. Reduce inequalities and wealth a. assessment
b. collection
3. The power of taxation proceeds upon a this theory c. levy
that the existence of the government is a d. payment
necessity; that it cannot continue without means
13. Although the power of taxation is basically
to pay its expenses; and that it has a right to
legislative in character, it is NOT the function of
compel all its citizens and property within the its
Congress to
limits to contribute.
a. collect the tax levied under the law
a. Benefit-received theory
b. determine who should be subject to the tax
b. Doctrine of symbiotic relationship
c. fix with certainty the amount of taxes
c. Lifeblood doctrine
d. identify who should collect the tax
d. Theory of relativity
14. A rule in taxation which states that all taxable
4. As to subject matter, it is a tax imposed upon the
persons and property of the same class are taxed
performance of an act, the enjoyment if a
at the same rate
privilege or the engaging in an occupation.
a. Scope of taxation
a. Ad valorem tax
b. Situs of taxation
b. Excise or privilege tax
c. Theory of taxation
c. Personal, poll or capitation tax
d. Uniformity in taxation
d. Property tax
15. The country that has the jurisdiction or right to levy
5. The basis of taxation is found on the reciprocal
and collect the tax
duties of protection and support between the
a. Scope of taxation
State and its inhabitants. This theory is otherwise
b. Situs of taxation
known:
c. Theory of taxation
a. Benefit-received theory
d. Uniformity in taxation
b. Doctrine of symbiotic relationship
c. Lifeblood doctrine
16. It is the place of taxation.
d. Theory of relativity
a. Scope of taxation
b. Situs of taxation
6. The tax laws should be capable of convenient, just c. Theory of taxation
and effective administration:
d. Uniformity in taxation
a. Administrative Feasibility
b. Fiscal Adequacy
17. A theory which states that no person shall be
c. Theoretical Justice
imprisoned for non-payment of this type of tax
d. Uniformity
a. Excise tax
b. Poll tax
7. The sources of revenue should be sufficient to
c. Property tax
meet the demands of public expenditures:
d. Value added tax
a. Administrative Feasibility
b. Equality
18. The existence of the government is a necessity is a
c. Fiscal Adequacy
theory founded on:
d. Theoretical Justice a. Benefits received theory
b. Doctrine of symbiotic relationship
8. The tax burden should be proportionate to the c. Lifeblood theory
taxpayer’s ability to pay. d. The power to destroy
a. Administrative Feasibility
b. Fiscal Adequacy 19. The reason why cigarettes manufacturer are taxed
c. Theoretical Justice heavily is based on the theory that:
d. Uniformity a. The police power of the government is limitless
b. The power to tax includes the power to destroy
9. Theoretical justice is the: c. There is a symbiotic relationship between the
a. Ability to pay theory taxing authority and the taxpayer
b. Due process clause d. No viable answer given
c. Equal protection of the laws
d. Uniformity of taxation 20. These are restrictions arising from the very nature
of the power to tax itself:
10. Generally, the power of taxation can only levied a. Constitutional limitations
by: b. Inherent limitations
a. Bureau of Internal Revenue and Bureau of c. Self-limitations
Customs d. Self-restraints
 b. False

21. These are restrictions founded on the

fundamental law of the land:
a. Constitutional limitations 31. The power of eminent domain can only be
b. Inherent limitations exercised by the State:
c. Self-limitations a. True
d. Self-restraints b. False

22. Taxation is inherent in every sovereignty 32. The benefit-received theory is based on what
because: principle?
a. It may be exercised although it is not expressly a. Ability to pay theory
granted by the fundamental law b. Equity
b. The Congress of the Philippines, as a law- c. Necessity
making body delegated such power to the d. Reciprocity
State
c. The Constitution expressly provided for it 33. The statement “Without taxes, the government
d. The Tax Code afforded such power to the State would be paralyzed” is based on:
a. Ability to pay theory
23. 1st statement – The power of taxation is absolute. b. Benefit-received theory
2nd statement – The power of taxation is subject c. Life-blood theory
to limitations d. Paralysis theory
a. 1st statement is true
b. 2nd statement is true 34. A quasi-public corporation like the National Grid
c. Both are true Corporation of the Philippines (NGCP) may
d. Both are false exercise one of the inherent powers of the state.
Which is it?
24. 1st statement - No person shall be deprived of a. Police power
life, liberty, or property without due process of b. Power of eminent domain
law. 2nd statement – No person shall be denied c. Taxation power
equal protection of the law.
a. 1st statement is true 35. Which does NOT belong to the group?
b. 2nd statement is true a. Due process of law
c. Both are true b. Equal protection of the law
d. Both are false c. Non-impairment of obligation and contract
d. Territoriality
25. It means the recognition or respect accorded by
one jurisdiction within its territory over the law 36. Identify which escape of taxation is not allowed
of another because they are sovereign equals. by law.
a. Exemption from taxation of government entities a. Shifting
b. International comity b. Tax dodging
c. Reciprocity c. Tax minimization
d. Territoriality d. Transformation

26. It refers to fraudulent or forbidden schemes or
devices designed to lessen or defeat taxes.
a. Tax avoidance
b. Tax evasion
c. Either tax evasion or avoidance
d. Neither tax evasion or avoidance
27. It is the exploitation by the taxpayer of legally
permissible alternative tax rates or methods of
assessing taxable property or income in order to
reduce tax liability.
a. Tax avoidance
b. Tax evasion
c. Either tax evasion or avoidance
d. Neither tax evasion or avoidance
28. The transfer of the tax burden by one whom the
tax is assessed to another is called:
a. Tax avoidance
b. Tax evasion
c. Tax exemption
d. Tax shifting
29. It is the agreement between two States or
countries reduced in writing as to the treatment
of the income of each citizens within its
jurisdiction:
a. International comity
b. Reciprocity
c. Tax covenants
d. Tax treaty
37. Which is NOT an element of a valid tax?
a. It must be for public purpose
b. It must be payable in money
c. It must be proportional in character
d. It must be uniform and equitable
38. Which is NOT a source of tax law?
a. Decisions of the Court of Tax Appeals
b. Opinion of tax experts
c. Revenue regulations issued by the Secretary of
Department of Finance
d. Tax treaties entered into by the Philippines and
another foreign state
39. The issuance promulgated by the Secretary of
Finance:
a. Revenue Regulations
b. Revenue Memorandum Order
c. Revenue Memorandum Circular
d. Revenue Rulings
40. The Commissioner, when clarifying a specific
provisions of a law, shall issue:
a. Revenue Regulations
b. Revenue Memorandum Order
c. Revenue Memorandum Circular
d. Revenue Rulings

30. The power of taxation can only be exercised by

the State:
a. True