Chapter 1 – General Principles of taxation

Tax amnesty
This is an immunity from all criminal and civil obligations arising from
nonpayment of taxes. It is a general pardon given to all taxpayers; it applies only
to past periods, hence of retroactive application. It is distinguished from tax
exemption in the sense that while tax amnesty is immunity from civil and criminal
obligations, tax exemption is immunity from civil liability only. Moreover, tax
exemption is prospective in application, while tax amnesty is retroactive.
Doctrine of equitable recoupment
This doctrine states that where the refund of a tax illegally or erroneously
collected or overpaid by the taxpayer is barred by prescription, a tax presently
being assed against a tax payer may be recouped or set-off against the tax whose
refund is now barred by prescription.
Rule on set-off or compensation
A claim for taxes is not such a debt, demand, contract or judgment as is
allowed to be set-off; neither are they a proper subject of recoupment since they
do not arise out of the contract or transaction.
Taxpayer’s suit
A taxpayer has sufficient personality and interest to seek judicial assistance
with a view of restraining what he believes to an attempt to unlawfully disburse
public funds.
Sources of tax laws
Taxations is derived from:
1. The constitution
2. Statutory enactments
3. Administrative rulings and regulations
4. Judicial decisions