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Chapter 13 Taxation
Chapter 13 Taxation
Taxation
What is Taxation?
Compulsory or coercive
money collection by a
levying authority, usually a
government
All types of involuntary levies
from income to capital gains
to estate tax
An act, the resulting revenue is
called taxes
Taxation- means by which
government finance their
expenditure by imposing charges
on citizens and corporate
entities
Government- use taxation to
encourage or discourage
economic decisions
Practice of the government
collecting money from its citizens
to pay for public service like
public libraries or park
Practice of collecting taxes from
citizens based on their earnings
and property to support the
government and allow to fund
police, courts, military, build and
maintain roads
The price of being a citizen
Government compels taxation
through force- penalties or
imprisonment
Government- imposing institution
to tax
Physical assets- property
Specific events- sales transaction
Philippine Taxation
A. Constitution
Article VI, Section 28- “rule of
taxation shall be uniform and
equitable” and Congress shall evolve
a progressive system of taxation
B. National Law
1. National Internal Revenue Code-
R.A No. 8424 or the Tax Reform
Act of 1997
2. R.A No. 10963 or Tax Reform for
Acceleration and Inclusion Act of
2017
3. R.A No. 7160 or Local
Government Code of 1991
BIR- collect tax in national level
Local treasurer’s office- collect
tax at local level (provincial, city
Municipal, barangay)
BIR power and duty
0 250,000 0%
1. Wenceslao Trinidad
2. Juan Posadas Jr.
3. Alfredo Yatao
Japanese Era
Liwayway Vinzons-Chato-implement
the Action Centered Transformation
Program (ACTS) to realign and
direct the entire organization for
fulfillment of its mission and vision
5 year Tax Computerization Project
(TCP)- establishment of
Modern and computerized
Integrated Tax System and Internal
Administration System
Estrada Administration
1. Education
100% enrollment and
completion rates
Build 113,553 more classroom
Hire 181,980 more teachers
between 2017-2020
2. Healthcare Services
Major highways,
expressways, flood control
projects
TRAIN Law
Main features:
1. Lowering Personal Income Tax
(PIT)
2. Simplifying Estate and Donor’s
Tax
3. Expanding VAT
4. Increasing Excise Tax of
Petroleum Products
5. Increasing Excise Tax of
Automobiles
6. Excise Tax on Sweetened
Beverages
Lowering Personal Income
Tax (PIT)
Those with annual taxable income
below P250,000 are exempt from
paying PIT
Rest of taxpayer, except the richest,
see lower rates from 15% to 30% by
2023
Top individual taxpayer who exceeds
8 million, face higher
Tax rate from 32% to 35%
32% tax- income of 500,000
annually but TRAIN will bring it
down to 25%
Minimum wage earners-
exempted from income tax as
their income is below P250,000
Simplifying Estate and
Donor’s Tax
Lowered and harmonized so it
does not matter if the person pass
away, donated a property or
transfer a property
Loss in revenue but make land
market more efficient so that land
will go to its best use
Estate Tax