1.

TAXATION, IN GENERAL

Definition and Concept of Taxation

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b. .
c. .
d. .

- Alternative definition:

Nature of Taxation

1. Two-fold nature of taxation or nature of the power of taxation

a. Inherent power
b. Legislative power
2. Inherent Power
3. Legislative Power
4. Extent of the Legislative Power to tax

Characteristics of Taxation

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b. .
c. .
d. .
e. .
f. .
g. .

1. Taxation is an attribute of sovereignty

2. Taxation is legislative in character
3. Taxation does not have any retroactive effect
4. Taxation is subservient to the non-impairment clause
5. Taxation may be exercised jointly with the police power
6. Power to tax is unlimited
7. Taxation being an unlimited power may include the power to destroy
8. Power to tax involves the power to destroy so it must be exercised with caution
9. Power to tax is not power to destroy
10. Reconciliation of Marshalls view that, the power to tax involves the power to
destroy with the Holmes view that, the power to tax is not the power to destroy.

Power of Taxation compare with Other Powers

- Police Power
a. Concept of Police power
b. Taxation and police power
c. Taxation distinguished from police power
1. The distinctions between taxation and police power
2. Distinctions between the power of taxation and police power according to
Cooley
d. License fees are collected under police power
e. Implications of collecting license fees under police power
1. Regulatory taxes should not be onerous
- Power of Eminent Domain
Purpose of Taxation

- Revenue-raising
- Non-revenue/special or regulatory

Principles of Sound Tax System

- Fiscal Adequacy
- Administrative Feasibility
- Theoretical Justice

Theory and Basis or Taxation

- Lifeblood Theory
- Necessity Theory
- Benefits-protection Theory (Symbiotic Relationship)
- Jurisdiction over subject and objects

Doctrines in Taxation

- Prospectivity of tax laws

- Imprescriptibility
- Double Taxation
o Strict Sense
o Broad Sense
o Constitutionality of Double Taxation
o Modes of Eliminating Double Taxation

2. ESCAPE FROM TAXATION

Escape from Taxation

- Shifting of tax burden

o Ways of shifting the tax burden
o Taxes that can be shifted
o Meaning of impact and incidence of taxation
- Tax avoidance
- Tax evasion

Exemption from taxation

- Meaning of exemption from taxation

- Nature of tax exemption
- Kinds of tax exemption
o Express
o Implied
o Contractual
- Rationale or grounds for exemption

Compensation and set-of

Compromise
Tax amnesty

- Definition
- Distinguished from tax exemption

3. CONSTRUCTION AND INTERPRETATION

Construction and interpretation of:

- Tax laws
o General rule
o Exception
- Tax exemption and exclusion
o General Rule
o Exception
- Tax rules and regulations
o General Rule only
- Penal Provisions of Tax laws
- Non-retroactive application to taxpayers
- Exceptions

4. LIMITATIONS ON THE POWER OF TAXATION, THE INHERENT LIMITATIONS

Scope and limitation of taxation

- Inherent limitations
o Public purpose
o Inherently legislative
General Rule
Exceptions
Delegation to local governments
Delegation to the President
Delegation to Administrative Agencies
o Territorial
Situs of Taxation
Meaning
Situs of Income Tax
From sources within the Phils.
From sources without the Phils.
Income partly within and partly without the Phils.
Situs of property taxes
Taxes on real property
Taxes on personal property
Situs of excise tax
Estate tax
Donors tax
Situs of Business tax
Sale of real property
Sale of personal property
 Value-Added Tax (VAT)
o International Comity
Exemption of government entities, agencies and instrumentalities

5. CONSTITUTIONAL LIMITATIONS

Provisions directly afecting taxation

- Prohibition against imprisonment for non-payment of poll tax

- Uniformity and equality of taxation
- Grant by Congress of authority to the Pres. to impose tarif taxes
- Prohibition against taxation of religious, charitable entities, and educational entities
- Prohibition against taxation of non-stock, non-profit institutions
- Majority vote of Congress for grant of tax exemption
- Prohibition on use of tax levied for special purpose
- Presidents veto power on appropriation, revenue, tarif bills
- Non-impairment of jurisdiction of the Supreme Court
- Grant of power to the LGUs to create its own sources of revenue
- Flexible tarif clause
- Exemption from real property taxes
- Non appropriation or use of public money for religious purposes

Provisions indirectly afecting taxation

- Due process
- Equal protection
- Religious freedom
- Non-impairment of obligations of contracts

6. DEFINITION, NATURE, CHARACTERISTICS OF TAX

Stages of taxation

- Levy
- Assessment and collection
- Payment
- Refund

Requisites of a valid tax

Tax as distinguished from other forms of exactions

- Tarif
- Toll
- License fee
- Special assessment
- Debt

Kinds of taxes

- As to object
o Personal, capitation, or poll tax
 o Property tax
o Privilege tax
- As to burden or incidence
o Direct
o Indirect
- As to tax rates
o Specific
o Ad valorem
o Mixed
- As to purposes
o General or fiscal
o Special, regulatory, or sumptuary
- As to scope or authority to impose
o National internal revenue taxes
o Local real property tax, municipal tax
- As to graduation
o Progressive
o Regressive
o Proportionate

ABELARDO T. DOMONDON