Taxation

Presenter:
Kristian J. Cargo
Prince Jude R. Pitinez
WHAT IS TAXATION
The Central and State government plays a significant
role in determining the taxes in India. To streamline
the process of taxation and ensure transparency in the
country, the state and central governments have
undertaken various policy reforms over the last few
years. One such change was the Goods and Services
Tax (GST) which eased the tax regime on the sale and
deliverance of goods and services in the country. 
Different Types of Taxation 
As mentioned above, taxation applies to all different types of levies. These can include
(but are not limited to):
 Income tax: Governments impose income taxes on financial income generated by all
entities within their jurisdiction, including individuals and businesses.
 Corporate tax: This type of tax is imposed on the profit of a business. 
 Capital gains: A tax on capital gains is imposed on any capital gains or profits made by
people or businesses from the sale of certain assets including stocks, bonds, or real
estate.  
 Property tax: A property tax is asses by a local government and paid for by the owner of a
property. This tax is calculated based on property and land values.  
 Inheritance: A type of tax levied on individuals who inherit the estate of a deceased
person.  
 Sales tax: A consumption tax imposed by a government on the sale of goods and services.
This can take the form of a value-added tax (VAT), a goods and services tax (GST), a state
or provincial sales tax, or an excise tax.       
A detailed breakdown of the procedure for
filing the tax 
The tax structure in India can be classified into two
main categories: 
Direct Tax 
Indirect Tax 
Direct Tax:
It is defined as the tax imposed directly on
a taxpayer and is required to be paid to the
government. Also, an individual cannot pass or assign
another person to pay the taxes on his behalf. 
Income tax- it is the tax applicable on the income
earned by an individual or taxpayer. 
Corporate tax- this is the tax applicable on the profits
earned by companies from their businesses. 
Indirect Tax
It is defined as the tax levied not on the income, profit
or revenue but the goods and services rendered by the taxpayer.
Unlike direct taxes, indirect taxes can be shifted from one
individual to another. Earlier, the list of indirect taxes imposed
on taxpayers included service tax, sales tax, value added tax
(VAT), central excise duty and customs duty. 
However, with the implementation of goods and services tax
(GST) regime from 01 July 2017, it has replaced all forms
of indirectax imposed on goods and services by the state and
central governments. GST has not only been reduced the
physical interface but also lower the cost of compliance with the
unification of the indirect taxes.   
TAXATION IN THE PHILIPPINES
Income Tax Rate 5% - 32%
Corporate Tax Rate 30%
Sales Tax VAT rate 12%
Personal Income Tax
Income of residents in Philippines is taxed
progressively up to 32%. Resident citizens are taxed on
all their net income derived from sources within and
without the Philippines.
Income in Philippines is divided into the following three categories
which are taxed separately,

1. Compensation employment income:

2. Passive income:

3. Business income and professional income:

Corporate Tax
It is important to note that foreign corporations,
whether resident or nonresident, are taxable only on
income derived from sources within the Philippines.

Withholding Tax
All other taxable income earned by domestic and
resident foreign corporations is subject to a 20% final
withholding tax
The net capital gains from the sale of shares of stock of
a domestic corporation are taxed on a per transaction
basis at the rate of 5% on the first PhP 100,000 and 10%
in excess of said amount.
The sale of land, building and other real properties
classified as capital asset is subject to 6% final capital
gains tax based on the gross selling price.
Any branch profit to be remitted to the Head Office is
additionally taxed at the rate of 15%.
Value Added Tax/ Sales Tax

Gross selling price

Dividends received by non-resident foreign

corporations from domestic corporations are subject
to a final tax of 30 %.
Tax Incentives for SMEs
Direct Tax :
Tax incentives also available to enterprises registered
with the Philippine Economic Zone Authority (PEZA).
These incentives are shown below:
 4 to 8 years income tax holiday. A 5% tax on the modified gross income is
imposed after the end of the income tax holiday.
 Tax and duty exemption on imported capital equipment and raw materials.
 National and local tax exemption.
 Tax rebate for the purchase of domestic capital good.
Indirect Tax
Under the Investment Priority Plan (IPP), SME owners
shall be eligible for the following incentives.
- An exemption from wharfage dues and export tax,
duty import and fees.
- Additional deduction for labor expense (ADLE).
- Additional deduction for necessary and major
infrastructure works