AS TO SUBJECT MATTER OR OBJECT

 
1.       Personal, poll or capitation tax
 
          Tax of a fixed amount imposed on persons residing within a
specified territory, whether citizens or not, without regard to their
property or the occupation or business in which they may be
engaged, i.e. community tax.
 
2.       Property tax
 
          Tax imposed on property, real or personal, in proportion to its
value or in accordance with some other reasonable method of
apportionment.
 
3.       Excise tax
 
          A charge imposed upon the performance of an act, the
enjoyment of a privilege, or the engaging in an occupation.
 
AS TO PURPOSE
 
1.       General/fiscal/revenue tax
 
A general/fiscal/revenue tax is that imposed for the purpose of
raising public funds for the service of the government.
 
2.       Special/regulatory tax
 
A special or regulatory tax is imposed primarily for the
regulation of useful or non-useful occupation or enterprises and
secondarily only for the purpose of raising public funds.
 
AS TO WHO BEARS THE BURDEN
 
1.       Direct tax
 
A direct tax is demanded from the person who also shoulders
the burden of the tax.  It is a tax which the taxpayer is directly or
primarily liable and which he or she cannot shift to another.
 
2.       Indirect tax
 
An indirect tax is demanded from a person in the expectation
and intention that he or she shall indemnify himself or herself at the
expense of another, falling finally upon the ultimate purchaser or
consumer.  A tax which the taxpayer can shift to another.
 
AS TO SCOPE OF THE TAX
 
1.       National tax
 
A national tax is imposed by the national government.
 
2.       Local tax
 
A local tax is imposed by municipal corporations or local
government units (LGUs).
 
AS TO THE DETERMINATION OF AMOUNT
 
1.       Specific tax
 
A specific tax is a tax of a fixed amount imposed by the head or
number or by some other standard of weight or measurement.  It
requires no assessment other than the listing or classification of the
objects to be taxed.
 
2.       Ad valorem tax
 
An ad valorem tax is a tax of a fixed proportion of the value of
the property with respect to which the tax is assessed.   It requires
the intervention of assessors or appraisers to estimate the value of
such property before the amount due from each taxpayer can be
determined.
 
 TOLL is a sum of money for the use of something which is paid of the
use of a road, bridge or public nature.
 PENALTY is a sanction imposed as a punishment for violation of law or
acts deem injurious.

 SPECIAL ASSESSMENT is an enforced proportional contribution from

owners of the lands for special benefits resulting from public
improvements.
Characteristics: a. Levied only on land
b. Not a personal liability of the person assessed
c. Based wholly on benefits (not necessary)
d. Exceptional both as to time and place

 REVENUE refers to all funds or income derives by the government.

 SUBSIDY is a pecuniary aid directly granted by the government to an

individual or enterprise deemed beneficial to the public.

 PERMIT or LICENSE is a charge imposed under the police power for

purposes of regulation.

 CUSTOMS DUTIES are taxes imposed on goods exported from or

imported into a country.

 TARIFF is the system of imposing duties on the importation or

exportation of goods.

DIRECT DOUBLE TAXATION means taxing twice:

1. By the same taxing authority, jurisdiction or taxing district
2. For the same purpose
3. In the same year or taxing period
4. Same subject or object
5. Same kind or character of the tax

MEANS OF AVOIDING THE BURDEN OF TAXATION

1. Shifting – the transfer of the burden of tax by the original payer to

someone else
2. Transformation – the producer pays the tax and endeavor to
recoup himself by improving his process of production
3. Evasion – the use of illegal means to defeat or lessen tax
4. Tax Avoidance – the exploitation of legally permissible alternative
tax rates of assessing taxable income to reduce
tax liability
5. Exemption – the grant of immunity to particular persons of a
particular class
6. Capitalization – the reduction in the selling price of income
producing property by an amount equal to the
capitalized value
7. Avoidance – the tax saving device within the means sanctioned by
law.

SOURCES OF TAX LAWS

1. Constitution
2. National Internal Revenue Code
3. Tariff and Customs Code
4. Local Government Code (Book II)
5. Local tax ordinances/ City or municipal tax codes
6. Tax treaties and international agreements
7. Special Laws
8. Decision of the Supreme Court and the Court of Tax Appeals
9. Revenue rules and regulations and administrative ruling and opinion

INDIVIDUAL TAXPAYERS are natural persons with income derived from

within the territorial jurisdiction of taxing authority. They are classified as:
1. Resident Citizens(RC) ● Engaged in trade/business
2. Nonresident Citizens (NRC) (NRA-ETB)
3. Resident Aliens (RA) ● Nonresident aliens not engaged
4. Nonresident Aliens (NRA) in trade or business (NRA-NETB)

Importance of classification:
They differ as to:
 Situs of income
 Manner of computing tax
 Treatment of certain passive incomes
 Allowable deductions
 References in the tax choice
 TOLL is a sum of money for the use of something which is paid of the
use of a road, bridge or public nature.

 PENALTY is a sanction imposed as a punishment for violation of law or

acts deem injurious.

 SPECIAL ASSESSMENT is an enforced proportional contribution from

owners of the lands for special benefits resulting from public
improvements.
Characteristics: a. Levied only on land
b. Not a personal liability of the person assessed
c. Based wholly on benefits (not necessary)
d. Exceptional both as to time and place

 REVENUE refers to all funds or income derives by the government.

 SUBSIDY is a pecuniary aid directly granted by the government to an

individual or enterprise deemed beneficial to the public.

 PERMIT or LICENSE is a charge imposed under the police power for

purposes of regulation.

 CUSTOMS DUTIES are taxes imposed on goods exported from or

imported into a country.

 TARIFF is the system of imposing duties on the importation or

exportation of goods.

DIRECT DOUBLE TAXATION means taxing twice:

6. By the same taxing authority, jurisdiction or taxing district
7. For the same purpose
8. In the same year or taxing period
9. Same subject or object
10. Same kind or character of the tax

MEANS OF AVOIDING THE BURDEN OF TAXATION

8. Shifting – the transfer of the burden of tax by the original payer to
someone else
9. Transformation – the producer pays the tax and endeavor to
recoup himself by improving his process of production
10. Evasion – the use of illegal means to defeat or lessen tax
11. Tax Avoidance – the exploitation of legally permissible alternative
tax rates of assessing taxable income to reduce
tax liability
12. Exemption – the grant of immunity to particular persons of a
particular class
13. Capitalization – the reduction in the selling price of income
producing property by an amount equal to the
capitalized value
14. Avoidance – the tax saving device within the means sanctioned by
law.

SOURCES OF TAX LAWS

10. Constitution
11. National Internal Revenue Code
12. Tariff and Customs Code
13. Local Government Code (Book II)
14. Local tax ordinances/ City or municipal tax codes
15. Tax treaties and international agreements
16. Special Laws
17. Decision of the Supreme Court and the Court of Tax Appeals
18. Revenue rules and regulations and administrative ruling and opinion

INDIVIDUAL TAXPAYERS are natural persons with income derived from

within the territorial jurisdiction of taxing authority. They are classified as:
5. Resident Citizens(RC) ● Engaged in trade/business
6. Nonresident Citizens (NRC) (NRA-ETB)
7. Resident Aliens (RA) ● Nonresident aliens not engaged
8. Nonresident Aliens (NRA) in trade or business (NRA-NETB)

Importance of classification:
They differ as to:
 Situs of income
 Manner of computing tax
 Treatment of certain passive incomes
 Allowable deductions
 References in the tax choice

 TOLL is a sum of money for the use of something which is paid of the
use of a road, bridge or public nature.

 PENALTY is a sanction imposed as a punishment for violation of law or

acts deem injurious.

 SPECIAL ASSESSMENT is an enforced proportional contribution from

owners of the lands for special benefits resulting from public
improvements.
Characteristics: a. Levied only on land
b. Not a personal liability of the person assessed
c. Based wholly on benefits (not necessary)
d. Exceptional both as to time and place

 REVENUE refers to all funds or income derives by the government.

 SUBSIDY is a pecuniary aid directly granted by the government to an

individual or enterprise deemed beneficial to the public.

 PERMIT or LICENSE is a charge imposed under the police power for

purposes of regulation.

 CUSTOMS DUTIES are taxes imposed on goods exported from or

imported into a country.

 TARIFF is the system of imposing duties on the importation or

exportation of goods.

DIRECT DOUBLE TAXATION means taxing twice:

11. By the same taxing authority, jurisdiction or taxing district
12. For the same purpose
13. In the same year or taxing period
14. Same subject or object
15. Same kind or character of the tax

MEANS OF AVOIDING THE BURDEN OF TAXATION

15. Shifting – the transfer of the burden of tax by the original payer to
someone else
16. Transformation – the producer pays the tax and endeavor to
recoup himself by improving his process of production
17. Evasion – the use of illegal means to defeat or lessen tax
18. Tax Avoidance – the exploitation of legally permissible alternative
tax rates of assessing taxable income to reduce
tax liability
19. Exemption – the grant of immunity to particular persons of a
particular class
20. Capitalization – the reduction in the selling price of income
producing property by an amount equal to the
capitalized value
21. Avoidance – the tax saving device within the means sanctioned by
law.

SOURCES OF TAX LAWS

19. Constitution
20. National Internal Revenue Code
21. Tariff and Customs Code
22. Local Government Code (Book II)
23. Local tax ordinances/ City or municipal tax codes
24. Tax treaties and international agreements
25. Special Laws
26. Decision of the Supreme Court and the Court of Tax Appeals
27. Revenue rules and regulations and administrative ruling and opinion

INDIVIDUAL TAXPAYERS are natural persons with income derived from

within the territorial jurisdiction of taxing authority. They are classified as:
9. Resident Citizens(RC) ● Engaged in trade/business
10. Nonresident Citizens (NRC) (NRA-ETB)
11. Resident Aliens (RA) ● Nonresident aliens not engaged
12. Nonresident Aliens (NRA) in trade or business (NRA-NETB)
Importance of classification:
They differ as to:
 Situs of income
 Manner of computing tax
 Treatment of certain passive incomes
 Allowable deductions
 References in the tax choice

 TOLL is a sum of money for the use of something which is paid of the
use of a road, bridge or public nature.

 PENALTY is a sanction imposed as a punishment for violation of law or

acts deem injurious.

 SPECIAL ASSESSMENT is an enforced proportional contribution from

owners of the lands for special benefits resulting from public
improvements.
Characteristics: a. Levied only on land
b. Not a personal liability of the person assessed
c. Based wholly on benefits (not necessary)
d. Exceptional both as to time and place

 REVENUE refers to all funds or income derives by the government.

 SUBSIDY is a pecuniary aid directly granted by the government to an

individual or enterprise deemed beneficial to the public.

 PERMIT or LICENSE is a charge imposed under the police power for

purposes of regulation.

 CUSTOMS DUTIES are taxes imposed on goods exported from or

imported into a country.
 TARIFF is the system of imposing duties on the importation or
exportation of goods.

DIRECT DOUBLE TAXATION means taxing twice:

16. By the same taxing authority, jurisdiction or taxing district
17. For the same purpose
18. In the same year or taxing period
19. Same subject or object
20. Same kind or character of the tax

MEANS OF AVOIDING THE BURDEN OF TAXATION

22. Shifting – the transfer of the burden of tax by the original payer to
someone else
23. Transformation – the producer pays the tax and endeavor to
recoup himself by improving his process of production
24. Evasion – the use of illegal means to defeat or lessen tax
25. Tax Avoidance – the exploitation of legally permissible alternative
tax rates of assessing taxable income to reduce
tax liability
26. Exemption – the grant of immunity to particular persons of a
particular class
27. Capitalization – the reduction in the selling price of income
producing property by an amount equal to the
capitalized value
28. Avoidance – the tax saving device within the means sanctioned by
law.

SOURCES OF TAX LAWS

28. Constitution
29. National Internal Revenue Code
30. Tariff and Customs Code
31. Local Government Code (Book II)
32. Local tax ordinances/ City or municipal tax codes
33. Tax treaties and international agreements
34. Special Laws
35. Decision of the Supreme Court and the Court of Tax Appeals
36. Revenue rules and regulations and administrative ruling and opinion
INDIVIDUAL TAXPAYERS are natural persons with income derived from
within the territorial jurisdiction of taxing authority. They are classified as:
13. Resident Citizens(RC) ● Engaged in trade/business
14. Nonresident Citizens (NRC) (NRA-ETB)
15. Resident Aliens (RA) ● Nonresident aliens not engaged
16. Nonresident Aliens (NRA) in trade or business (NRA-NETB)

Importance of classification:
They differ as to:
 Situs of income
 Manner of computing tax
 Treatment of certain passive incomes
 Allowable deductions
 References in the tax choice