Purposes of taxation

 
1.       Revenue or fiscal: The primary purpose of taxation on the part of the government is to
provide funds or property with which to promote the general welfare and the protection of
its citizens and to enable it to finance its multifarious activities.
 
2.       Non-revenue or regulatory: Taxation may also be employed for purposes of regulation
or control.
 
a)       Imposition of tariffs on imported goods to protect local industries.
 
b)       The adoption of progressively higher tax rates to reduce inequalities in wealth and
income.
 
c)       The increase or decrease of taxes to prevent inflation or ward off depression.
 
PAL v. Edu, 164 SCRA 320
 
                     The legislative intent and purpose behind the law requiring owners of vehicles to pay
for their registration is mainly to raise funds for the construction and maintenance of
highways and, to a much lesser degree, pay for the operating expenses of the
administering agency. It is possible for an exaction to be both a tax and a regulation.
License fees are charges, looked to as a source of revenue as well as a means of
regulation. The fees may properly be regarded as taxes even though they also serve as
an instrument of regulation. If the purpose is primarily revenue, or if revenue is at least
one of the real and substantial purposes, then the exaction is properly called a tax.
 
Tio v. Videogram, 151 SCRA 208
 
                     PD 1987 which created the Videogram Regulatory Board also imposed a 30% tax on
the gross receipts payable to the local government. SC upheld the validity of the law
ruling that the tax imposed is not only a regulatory, but also a revenue, measure
prompted by the realization that earnings of videogram establishments of around P600
million annually have not been subjected to tax, thereby depriving the government of an
additional source of revenue. It is a user tax imposed on retailers for every video they
make available for public viewing. The 30% tax also served a regulatory purpose: to
answer the need for regulating the video industry, particularly the rampant film piracy,
the flagrant violation of intellectual property rights, and the proliferation of pornographic
video tapes.
*What is BIR?
The Bureau of Internal Revenue is an agency of Department of Finance. BIR collects
more than half of the total revenues of the government. Caesar Dulay is the current
Commissioner of BIR.
MANDATE
The Bureau of Internal Revenue shall be under the supervision and control of the
Department of Finance and its powers and duties shall comprehend the assessment
and collection of all national internal revenue taxes, fees, and charges, and the
enforcement of all forfeitures, penalties, and fines connected therewith, including the
execution of judgments in all cases decided in its favor by the Court of Tax Appeals and
the ordinary courts. The Bureau shall give effect to and administer the supervisory and
police powers conferred to it by this Code or other laws. (Section 2 of the National
Internal Revenue Code of 1997)

MISSION
We collect taxes through just enforcement of tax laws for nation-building and the
upliftment of the lives of Filipinos

VISION The Bureau of Internal Revenue is an institution of service excellence and

integrity.

GUIDING PRINCIPLE "Service Excellence with Integrity and Professionalism"

*What are the policies that govern BIR?

National Tax Law

I. 1987 Constitution

The 1987 Philippine Constitution sets limitations on the exercise of the power to tax.
The rule of taxation shall be uniform and equitable.
 All money collected on any tax levied for a special purpose shall be treated as a
special fund and paid out for such purpose only.
 The Congress may, by law, authorize the President to fix within specified limits, and
subject to such limitations and restriction
 The Supreme Court shall have the power to review, revise, reverse, modify or
affirm on appeal or certiorari, as the law or the Rules of Court may provide, final
judgments and orders of lower courts