TAXES, TAX LAWS, AND TAX ADMINISTRATION TAX - enforced proportionate contribution = levied whin territorial and legal juritdiction ~ exercised wy the legitlative + for public purpose 7 Gencralty Payable in money CLASSIFICATION OF TAXES ~ to regulate business, conduct acts or transactions Achiewe Social and economic. objectives (who shall bear the burden of taxation) = tax is collected {rom the person who is aid intended 40 pay the fame + fax V paid by any person other than the one Whe ic intended to pay the same = on A per unit basis (bilo, liter, or meter, etc-) = upon the value of the tax object - flat or fixed rates emphasizes equality ; wo regard to ability t» pay ~ Increosing rater ar the tax bare increases 5 equitable decreasing rater os dre tax bare increaces combination ox. (PeDives) cuctom dutien) Percentage An Domor'c and Estate tax Incom tax internal Value-Added fax. Revenue Erate tax Tevet Stamp day Custom duties oinere (motor vehicle reqictration tax. imigration tax, tte-) Real property iaces Professional tax Business faxes feet, and charges Community tax ‘Taw on banke and ether financial institutioneTAX NS. SIMILAR ITEMS = Tefers to the amount Imposed = _refere to amount collected = omy one of the courcer of government revenwer = The product of taxation; refers to all income colectione of Pre government UK DOS For revenue or_requiation Amount No limit limited (to cover the cott) | Subject of impesifion teanconfions Person, propaties, bwiined right, interests, privilege, actt, and Required {or Phe. cormencement of 4 butinest profestion Effect of nbircompliance Does not necessarity make the ‘walker the business illegal ack, usinest, or profestion illegal Reyocabitity Has m nature of permanence Aways vevo cable Scope. includes the power to license doe not include he power to tax When imped post> achvity pre-ackivity Basis of Impocition current data Preceding year or quarter date. new business vated on capitalization Sources OF power ‘taxing power police power ~ Demand of lon cours of tc iam + Exeaative orders and Batac Pambanca + Tox Treaties and Conventions w) foreign countries + Administrative \ssuanee ——————> 1YPES OF ADMINISTRATIVE KiGUANCE + Judicial Oecicions + Revere Regulations + Local ordinances + Revere memorandum ordert + Revenwe Regulation by the DoF + Reverme memorandum rulings + Revenue memorandum ciruslare + Reverme boutleting + DIR Rulings “Reyerime Requiation ~ formai pronouncement iniended 10 clarify or txplain ihe tne law and carry into eect ity general provicions by providing detail o administration = has the force and effect of law. but it is not intended t expand or limit the APHication of the law, Otherwice # is void CIR (Recvornendation) ———+ DoF (teview and approve ) “BIR Rulings lees general interpretations of the tax laws at the administrative lever = isued torn time to dime by the CR - Official poiitions of the Buccaw to queries raiced by taxpayer and other Hakenololert = mere advicory or a sort of information 10 the taxpayer — binding fo the the addrestee ony; May be reverred by Be at anytime | Sowree, ___Congytess DoF Bie Superiority | fat | 2rd 3rd Leope. Broad Effect of law Specific (except if general ruling) ~ Valid on to the extent of fact on queries GAAP WS. Tax lawc - in cater of conflict, tax laws will prevail Nature of Prtippine. Tar Laws w PH tax laws ave civil and not political in nature we Inturnal revenue laws a1 in nature becaure they do not define crime. their penalty proviciont ove merely intended te cecure taxpayers’ Comptiance-TAX ADMINISTRATION = Ftfere to the management of the fax syctem = entrwcted to Bureau of Internal Revere (BIR) which it under ne cupersicion ond Administration of ‘Pe Department of Finance (DoF) ee 2 4 auistant chief: Deputy commiccioner a) Operations gewp b) Legal Enforcement group ©) Information Syctome grup #) Resource Management group 1) Asceament and collection of taxes (internal revenue taxes) 4) Enforcement of all forfeitures, penalties and Fines, ond judgments In all caset decided in itt favor by he courts DP Giving cHfurtt to, and administering the cupervisary And police power conferred 40 it by the NiRe and other lawe # Agignment of intunal revenue Officers dnd other employee: t other duties 1) Provicion and dictibution of forms, rectiptt. certificates, slampy, etc- f» proper official © Issuance of reetipts and clearances ¥9 Sulomicsion of annual report, Pertinent information t Congress ond reporte ty the Congreccional Oversight Commitee in matters of taxation 1) Te interpret the provitions of the NIRE, EB Bectare — see iimate = mE of Minima aerate Aton Soe ~ am cle re "ar? "ae 1M —+ satignal Evaluation Tee m4 : 2) To Conduct inventory faking or surveillance —+ unreasonobic under-dectoration 4) To preteribe precumptive qrecr calet or Feceiptr —~ ead on dimer buine ww) To preserive real estate values — appicc ont t tnd The CIR K authorized to divide the Philippines ino zones and preieribed real properly values after consultation w] competent appraicor 1) To accredit and regiciur tax agents = The denial by He ck ef application for accreditation it appeatdble to the DoF. The failure, of Scerctary of Finance to act on tne appeal w]in uo daye ic deemed an approval 'p) Te inguire inte bank depositer, only under the following instances: + Determination of the grees eXtate of a cecedent * To Subttantiate the taxpayer’ claim ot financial incapacity tp Pay fax in an application for fax compliance,®) To prescibe additonal procedures or documentary requivements ¥) To deligate his powerr 10 any subordinate. officer wi rank equivalent to a division chief OF an Hice 18) 0 refund or crudit internal rwenwe taxes 1) To abate or cancel fax liabilities in certoin cages =: austen! opeas fess yma 1) To examine tax retums and determine tax dae thereon 8) To came twenue Officere and employees te make a Canvass fram time fo time Of any rewnue dishict Or region concerning taxpayer 1) The power 40 recommend the promutgation of rules andl regulations to the Secretary of Finance 2) The power fo issue mulings of first impression oF fo reverie, revoke. or modify any existing ruling! of He Buran 3) The power fo compromice or abate any tax liability = Exceptionally, # ay Compromire tax liabilities under the follo @) assecsments are Iss i Fegional efices invoWving basi b) involves criminal violation’ discovered by regional and dictrict Officials ) The power to qusign and reaccign internal revenne officer t» Cstablichment wher articles ATG eo RETO eRe he ae * Revenue autignea 40 an establichenent Where excitable articles ate kept chall in no cace stay ‘here for more than 2 yearr * Revenue assigned to perform aurecement and collection fanction shall net remo aiignment for more than 3 year + Acciqnment of internat revenue officers and employees the Bureau to “Govt _[lasteyer 1 nota law < tag a < exemption ~» exemption —» jaxpayer| Govt Taw law ~ The government cannot enrich itrelt at the expente ef taxpayer ~ NOt applicable in the Philippines ax it confiicts w) prescription tawe = Taxes are not subject 40 automatic set-off or compeniation. = Gwernment and taxpayer # creditor and debtor ~ ken + taxpayer's tlaim hai already become due and demandable * Coser of ebvjoM overpayment Of faves + Local toixes = amy micreprecentation made by one party fyward another whe relic therein in good faith will be hed true and binding against that person who Made the mistepresentation = operatec only aqainct the taxpayer. and ret the government