Illustrations of lifeblood theory

 
1.       Collection of taxes cannot be enjoined by injunction.
 
2.       Taxes could not be the subject of compensation or set off.
 
3.       A valid tax may result in destruction of the taxpayer’s property.
 
4.       Taxation is an unlimited and plenary power.
 
Benefit-received principle
 
                     This principle serves as the basis of taxation and is founded on the reciprocal duties of
protection and support between the State and its inhabitants.  Also called “symbiotic
relation”between the State and its citizens.
 
                     In return for his contribution, the taxpayer receives the general advantages and
protection which the government affords the taxpayer and his property.  One is
compensation or consideration for the other; protection for support and support for
protection.
 
                     However, it does not mean that only those who are able to and do pay taxes can enjoy
the privileges and protection given to a citizen by the government.
 
                     In fact, from the contribution received, the government renders no special or
commensurate benefit to any particular property or person.  The only benefit to which
the taxpayer is entitled is that derived from the enjoyment of the privileges of living in
an organized society established and safeguarded by the devotion of taxes to public
purpose.  The government promises nothing to the person taxed beyond what may be
anticipated from an administration of the laws for the general good. [Lorenzo v.
Posadas]
 
                     Taxes are essential to the existence of the government. The obligation to pay taxes
rests not upon the privileges enjoyed by or the protection afforded to the citizen by the
government, but upon the necessity of money for the support of the State. For this
reason, no one is allowed to object to or resist payment of taxes solely because no
personal benefit to him can be pointed out as arising from the tax. [Lorenzo v.
Posadas]
 
TAX DIFFERENTIATED FROM OTHER TERMS
 
 
Tariff / Duties
 
                     The term tariff and custom duties are used interchangeably in the Tariff and Customs
Code or PD No. 1464.
 *What is BIR?
The Bureau of Internal Revenue is an agency of Department of Finance. BIR collects
more than half of the total revenues of the government. Caesar Dulay is the current
Commissioner of BIR.
MANDATE
The Bureau of Internal Revenue shall be under the supervision and control of the
Department of Finance and its powers and duties shall comprehend the assessment
and collection of all national internal revenue taxes, fees, and charges, and the
enforcement of all forfeitures, penalties, and fines connected therewith, including the
execution of judgments in all cases decided in its favor by the Court of Tax Appeals and
the ordinary courts. The Bureau shall give effect to and administer the supervisory and
police powers conferred to it by this Code or other laws. (Section 2 of the National
Internal Revenue Code of 1997)

MISSION
We collect taxes through just enforcement of tax laws for nation-building and the
upliftment of the lives of Filipinos

VISION The Bureau of Internal Revenue is an institution of service excellence and

integrity.

GUIDING PRINCIPLE "Service Excellence with Integrity and Professionalism"

*What are the policies that govern BIR?

National Tax Law

I. 1987 Constitution

The 1987 Philippine Constitution sets limitations on the exercise of the power to tax.
The rule of taxation shall be uniform and equitable.
 All money collected on any tax levied for a special purpose shall be treated as a
special fund and paid out for such purpose only.
 The Congress may, by law, authorize the President to fix within specified limits, and
subject to such limitations and restriction
 The Supreme Court shall have the power to review, revise, reverse, modify or
affirm on appeal or certiorari, as the law or the Rules of Court may provide, final
judgments and orders of lower courts