Exercises On Tax Remedies, CTA Jurisdiction and Local Taxation

Tax Remedies, CTA Jurisdiction, and Local Taxation
Instructions:
1. Answer these questions on a separate paper by your own handwriting.
2. Write the letter (ALL CAPS) of the best answer.
3. Send your answers individually to my viber account.
4. Test yourself and rely on your own understanding. Trust yourself and enjoy it.
1. Andaya filed his income tax return for 2015 on May 15, 2016 and paid the tax of P100,000. Upon
audit by the BIR, an assessment notice was issued on April 30, 2019 requiring Andaya to pay a
deficiency tax of P250, 000 not later than July 30, 2019. Andaya may:
a. Raise prescription as a defense
b. Request for an extension of time to pay the deficiency income tax
c. Go to the Court of Tax Appeals (CTA) to appeal the assessment made by the BIR
d. Ignore the assessment as the date of collection is beyond three years already as the taxable year
covers 2015
2. March 8, 2019 – Date assessment was received
March 18, 2019 – Petition for reinvestigation was filed with the Bureau of Internal Revenue (BIR)
April 8, 2019 – Documents supporting the petition for reinvestigation was filed with the BIR
April 28, 2019 – Date decision of denial of the petition for reinvestigation was received
The last day to appeal to the Court of Tax Appeals (CTA) is on
a. October 5, 2019
b. November 4, 2019
c. May 28, 2019
d. May 13, 2019
3. Using the preceding number, what if a request for reconsideration was filed with the BIR on May 7,
2019, when is the deadline to submit the supporting documents:
a. July 2, 2019
b. July 6, 2019
c. June 21, 2019
d. None
4. A continuation of the preceding number, what if instead of a denial of the request for reconsideration,
a revised assessment was received on June 2, 2019? The last day to appeal to the CTA is on, and
why? (provide explanation):
a. July 2, 2019
b. June 23, 2019
c. June 21, 2019
d. None of these
5. Using the facts of number 1, what if instead of receiving a denial of the petition for reinvestigation,
no decision on the protest is forthcoming? The last day to appeal to the CTA is on:
a. October 5, 2019
b. November 4, 2019
c. May 28, 2019
d. None of these
6. Which of the following is/are elements of impact of taxation?
i. Levy
ii. Assessment
iii. Collection
a. i only b. i and ii only. c. ii and iii only. d. iii only.
7. Applying the preceding number, if VAT is imposed on sugar, it is paid in the first instance by the
sugar manufacturers. However, VAT will be added to the price of the sugar sold, which, through a
series of transfer, will ultimately fall on the consumer of sugar. To whom does the impact of taxation
impose?
a. Consumers c. Senate
b. House of Representative d. Sugar manufacturers
8. All of the following are not taxes EXCEPT:
a. surcharge. b. special assessment c. custom duties. d. license fee
9. The Commissioner of Internal Revenue is not authorized to
a. Interpret the provisions of the National Internal Revenue Code
b. Issue Revenue Regulations.
c. Change a tax period.
d. Prescribe presumptive gross receipts.
10. Which of the following statement is incorrect?
a. Tax is a demand of sovereignty while toll is a demand of ownership
b. License is a pre-activity imposition while tax is a post-activity imposition
c. Non-payment of debt cannot lead to imprisonment but non-payment of any tax will cause
imprisonment
d. Debt is assignable while tax is not
11. Which of the following levy is fiscal or revenue by nature?
a. Tax law geared to phase out a deficit balance of the government.
b. Tax law intended to prohibit gambling in the Philippines.
c. Tax law intended to protect local industries.
d. Tax law supporting the development of a particular industry.
12. Statement 1: The recommendation letter of Commissioner of Internal Revenue is considered as a
formal assessment of tax liability.
Statement 2: Taxpayer’s suit requires illegal expenditure of pubic money.
a. Both statements are true
b. Both statements are false
c. Only Statement 1 is true
d. Only Statement 2 is true
13. All of the following are powers of the Commissioner of Internal Revenue, except?
a. to change a tax period
b. to prescribe real estate values
c. to impose criminal charges against erring BIR officers
d. to refund or credit internal revenue taxes
14. Statement 1: A taxpayer may validly question a Tax Law which benefits only a particular industry or
economic activity and which does not directly benefit such taxpayer.
Statement 2: The error of any government employee in the enforcement of taxes binds the
government and may be allowed to impede or estop government’s right to collect the correct taxes.
15. Statement 1: In case of vague statues levying taxes, these are to be construed strictly against the
government and liberally in favor of the subject or citizens to which they are imposed.
Statement 2: Without violating the law, Tax Shifting is a form of escape that can be legally resorted to
by the taxpayer without causing the government loss of revenue.

16. Statement 1: Violation of any of the principles of sound tax system invalidates a Tax Law.
Statement 2: A Tax Law imposing taxes on the income of foreign ambassadors or imposing real
property tax upon foreign ambassadors is valid as the power of taxation is comprehensive, unlimited,
plenary and supreme.
17. Statemen 1: Income Tax, Donor’s Tax, Real property Tax and Value Added Tax are all Direct Taxes.
Statement 2: Income Tax, Community Tax, Estate Tax and Occupation Tax are all Excise Taxes.
18. Which of the following is not among the powers of the Commissioner of Internal Revenue (CIR)?
a. Interpret the Provisions of NIRC
b. Compromise Tax Liabilities of Taxpayers
c. Conduct Inventory Taking or Surveillance
d. None of the above
19. Statement 1: The decisions of the CIR in disputed assessments, refunds and other matters arising
under the NIRC or other laws administered by the BIR is subject to the exclusive appellate
jurisdiction of the Court of Tax Appeals.
Statement 2: A taxpayer has the option to directly file a case to the Court of Tax Appeals to question
an assessment made by the BIR.
20. Statement 1: The power to interpret the provisions of this Code and other tax laws shall be under the
exclusive and original jurisdiction of the Commissioner, subject to review by the Secretary of Finance
Statement 2: The power to interpret the provisions of this Code and other tax laws shall be under the
exclusive and original jurisdiction of the Court of Tax Appeals.
21. An American citizen has been staying in the Philippines since August 15, 2017. What would be his
classification for the year 2017 and 2018, respectively?
a. Non-resident alien not engaged in trade or business; resident alien
b. Non-resident alien engaged in trade or business; resident alien
c. Non-resident alien not engaged in trade or business; resident citizen
d. Non-resident alien engaged in trade or business; resident citizen
22. It operates as a general pardon or intentional disregard by the State of its authority to impose penalties
on persons otherwise guilty of tax evasion or violations of the tax laws.
a. Tax exemption c. Tax amnesty

b. Tax sparing rule d. Tax condonation
23. The Commissioner of Internal Revenue is not empowered to
a. Make or amend a tax return for and in behalf of the taxpayer.
b. Obtain information and to summon, examine and take testimony of persons to effect tax
collections.
c. Compromise tax liabilities of taxpayers.
d. Grant amnesty for erring taxpayers.
24. Statement 1: Distraint and Levy, protesting an assessment and claim for refund are remedies accorded
to taxpayers under the Tax Code.
Statement 2: Compromise, Forfeiture, Tax Lien and Civil Penalties are among the remedies by the
Government for the collection of taxes.
25. Statement 1: Ping Guerrero filed an Income Tax Return due on April 15, 2016, on March 15, 2016,
with which the income declared is understated by 30% of the actual income he could have declared.
The BIR has 3 years from March 15, 2016 to assess Ping’s tax liability.
Statement 2: The taxpayer may file an administrative protest against an assessment within 60 days
from receipt of the assessment.
26. Statement 1: Taxation could be described as a power, as a process, or as a means. As a power,
taxation is a way of apportioning the cost of government among those who are privileged to enjoy its
benefits.
Statement 2: Appropriation of taxes is considered valid if intended for the common good of the
people without identifying a particular person to be benefited from it.
27. Which of the following statements is NOT correct?
a. The government automatically possesses the power to collect taxes from its inhabitants
b. The local government unit can enforce contribution upon its citizen only when the
Constitution or any delegated law grants it
c. The national government can enforce contribution upon its citizen only when the Constitution
or any delegated law grants it
d. The State has the supreme power to command and enforce contribution from the people
within its jurisdiction.
28. Which of the following statements is not correct?
a. Collections from taxes are public money
b. Appropriation of taxes for the common good of the people is valid
c. Construction of private road from taxes is a valid appropriation
d. Allocation of taxes for the benefit of greater portion of population is considered for public
purposes
29. The Commissioner may compromise the payment of any internal revenue tax when:
i. A reasonable doubt as to the validity of the claim against the taxpayer exists
ii. The financial position of the taxpayer demonstrates a clear inability to pay the assessed tax
iii. The tax or any portion thereof appears to be unjustly or excessively assessed
iv. The administration and collection costs involved do not justify the collection of the amount
due
a. i, ii, and iii only c. ii, iii, and iv only

b. i and ii only d. all of the above
30. Statement 1: For cases of financial incapacity, a minimum compromise rate equivalent to forty
percent (40%) of the basic assessed tax shall be allowed by the Commissioner
Statement 2: In case of reasonable doubt as to the validity of the claim against the taxpayer, a
minimum compromise rate equivalent to ten percent (10%) of the basic assessed tax shall be allowed
by the Commissioner
31. Statement 1: All criminal violations of the National Internal Revenue Code may be compromised
Statement 2: A criminal case for violations of the National Internal Revenue Code already filed in
court cannot be compromised
32. To safeguard the interest of the Government, the Commissioner, in his opinion, may place under
constructive distraint the property of a delinquent taxpayer in the following cases, EXCEPT:
a. The taxpayer is retiring from any business subject to tax
b. The taxpayer intends to leave the Philippines
c. The taxpayer performs any act tending to obstruct the proceedings for collecting the tax due or which
may be due from him
d. The period of assessment is about to expire
33. In case there is no bidder for real property exposed for foreclosure sale or if the highest bid is for an
amount insufficient to pay the taxes, penalties and costs, the remedy of the Commissioner for the
purpose of collecting the deficiency tax is
a. Distraint c. Forfeiture
b. Levy d. Resale
34. The running of the Statute of Limitations provided in Sections 203 and 222 of the NIRC on the
making of assessment and the beginning of distraint or levy a proceeding in court for collection, in
respect of any deficiency, shall be suspended on the following instances, EXCEPT:
a. taxpayer requests for a motion for reinvestigation which is granted by the Commissioner
b. taxpayer requests for a motion for reconsideration which is granted by the Commissioner
c. taxpayer cannot be located in the address given by him in the return filed upon which a tax is
being assessed or collected
d. when the warrant of distraint or levy is duly served upon the taxpayer
35. Statement 1: The Court of Tax Appeals has an exclusive original jurisdiction to review the inaction
by the Commissioner of Internal Revenue (CIR) in cases involving disputed assessments, refunds of
internal revenue taxes, fees or other charges, penalties in relations thereto, or other matters arising
under the National Internal Revenue Code or other laws administered by the Bureau of Internal
Revenue.
Statement 2: Based on the preceding paragraph, the inaction of the CIR shall be deemed a denial.
36. Statement 1: The taxpayers shall be informed in writing of the law and the facts on which the
assessment is made; otherwise, the assessment shall be void
Statement 2: If the protest is denied in whole or in part, or is not acted upon within one hundred
twenty (120) days from submission of documents, the taxpayer adversely affected by the decision or
inaction may appeal to the Court of Tax Appeals within thirty (30) days from receipt of the said
decision, or from the lapse of one hundred twenty (120)-day period
37. Pre-assessment notice shall not be required in the following cases, EXCEPT:
a. When the finding for any deficiency tax is the result of mathematical error in the computation of
the tax as appearing on the face of the return
b. When a discrepancy has been determined between the tax withheld and the amount actually
remitted by the withholding agent
c. When a taxpayer who opted to claim a refund or tax credit of excess creditable withholding tax
for a taxable period was determined to have carried over and automatically applied the same
amount claimed against the estimated tax liabilities for the taxable quarter or quarters of the
succeeding taxable year
d. When the income tax due on excisable articles has not been paid
38. Statement 1: The Court of Tax Appeals has an exclusive appellate jurisdiction to review decisions,
orders or resolutions of the Regional Trial Courts in local tax cases originally decided or resolved by
them in the exercise of their original or appellate jurisdiction
Statement 2: The Court of Tax Appeals has an exclusive original jurisdiction to review Decisions of
the Commissioner of Customs in cases involving liability for customs duties, fees or other money
charges, seizure, detention or release of property affected, fines, forfeitures or other penalties in
relation thereto, or other matters arising under the Customs Law or other laws administered by the
Bureau of Customs
39. Statement 1: The Court of Tax Appeals has an exclusive appellate jurisdiction to review Decisions of
the Central Board of Assessment Appeals in the exercise of its appellate jurisdiction over cases
involving the assessment and taxation of real property originally decided by the provincial or city
board of assessment appeals
Statement 2: The Court of Tax Appeals has an exclusive appellate jurisdiction to review the decisions
of the Secretary of Finance on customs cases elevated to him automatically for review from decisions
of the Commissioner of Customs which are adverse to the Government

40. Statement 1: The Court of Tax Appeals has an exclusive original jurisdiction over all criminal
offenses arising from violations of the National Internal Revenue Code or Tariff and Customs Code
and other laws administered by the Bureau of Internal Revenue or the Bureau of Customs
Statement 2: The Regional Trial Court shall try offenses or felonies mentioned in the NIRC where the
principal amount of taxes and fees, exclusive of charges and penalties, claimed is less than One
million pesos (P1,000,000.00) or where there is no specified amount claimed
41. Statement 1: Pursuant to the life blood doctrine, as a rule, no court shall grant an injunction to restrain
the collection of any national revenue tax, fee or charge imposed by the NIRC.
Statement 2: The “No injunction rule” is subject to the exception that when the decision of the
Commissioner is pending appeal before the Court of Tax Appeals (CTA), the CTA may enjoin the
collection of taxes if such collection will jeopardize the interest of the government and/or the taxpayer
42. Statement 1: The taxes collected by the national government may be used and appropriated by the
local government unit
Statement 2: The taxes collected by the local government unit may be used and appropriated by the
national government
43. If there is showing that expenses have been incurred but the exact amount thereof cannot be
ascertained due to absence of documentary evidence, it is the duty of the BIR to make an estimate of
deduction that may be allowable in computing the taxpayer’s taxable income, which estimate may be
based on 50% of the taxpayer’s claimed deduction. This is called
a. Cohan Rule c. Cojan Rule
b. Johan Rule d. Trojan Rule
44. Which of the following is not a fundamental principle of the Local Government Taxation?
a. Uniformity
b. Equitability
c. Collection of taxes is solely for the benefit of the national and local government
d. Progressive
45. A Province cannot impose the following, EXCEPT:
a. DST c. Taxes on premiums paid by way of reinsurance or retrocession
b. VAT d. RPT
46. Statement 1: Manufacturers, assemblers, contractors, producers, and exporters with factories, project
offices, plants, and plantations in the pursuit of their business shall allocate their sales in the their
principal office in which 30% will be taxable by the the city/municipality where the principal office is
located, and 70% shall be taxable by the city/municipality where the factory, project office, plant, or
plantation is located
Statement 2: Manila International Airport Authority is exempt from real property tax
a. Both statements are correct c. Only statement 1 is correct
b. Both statements are incorrect d. Only statement 2 is correct
47. Which is not a ground to suspend the running of prescription to assess a local tax?
a. The treasurer is legally prevented from making the assessment of collection
b. The taxpayer requests re-investigation and executes a waiver in writing before expiration of the
period within which to assess or collect
c. The taxpayer is out of the country or otherwise cannot be located
d. The taxpayer requests for reconsideration
48. Statement 1: The City Treasurer’s denial of protest of the taxpayer is appealable to Central Board of
Assessment Appeals within 30 days from receipt of denial.
Statement 2: Payment under protest is a pre-requisite to make a protest in a local tax dispute.
49. Statement 1: If the assessment of basic RPT or any other tax levied is found to be ILLEGAL or
ERRONEOUS and the tax is reduced or adjusted, the taxpayer may file a petition for refund or credit
for taxes and interests with the City Assessors Office within 2 years from the date the taxpayer is
entitled to such reduction or adjustment.
Statement 2: In assailing the validity of RPT, deposit is jurisdictional and must be complied with
all the time.
50. Statement 1: The Commissioner of Internal Revenue has the authority to issue an injunction order if
the collection of taxes will jeopardize the interest of the taxpayer
Statement 2: An LGU can impose amusement taxes on cabarets.
51. The following entities retained their tax exemption privileges given by the Local Government Code.
Which of the following is not included?
a. Local Water District
b. Cooperatives.
c. Non-stock Non Profit Educational Institutions
d. Religious sectors
“Knowledge must continually be renewed by ceaseless effort, if it is not to be lost. It resembles a

statue of marble, which stands in the desert and is continuously threatened with burial by the shifting
sand. The hands of service must ever be at work, in order that the marble continue lastingly to shine in
the sun.”
“That in all things God may be glorified”

Exercises On Tax Remedies, CTA Jurisdiction and Local Taxation

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Tax Remedies, CTA Jurisdiction, and Local Taxation

b. Both statements are false

a. Tax exemption c. Tax amnesty

a. i, ii, and iii only c. ii, iii, and iv only

c. Only Statement 1 is true

“Knowledge must continually be renewed by ceaseless effort, if it is not to be lost. It resembles a

“That in all things God may be glorified”

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