FINALS

TAXATION
Taxes are the lifeblood of the nation.
Without taxes, government can neither exist nor endure.
Taxation is in Accord with the Bible
Jesus said to them, “show me a silver coin. Whose face and name are these on it?” “The Emperor’s,”
they answered. So Jesus said, “well then, pay to the Emperor what belongs to the Emperor and pay to
God what belongs to God.”

Taxation
An inherent power of sovereign.
Imposes burden upon persons and property.
Raises revenues for public purposes.

Power to Tax Includes the Power to Destroy

According to CJ Marshall, taxation is a destructive power which interferes with the personal and
property rights of the people as it takes from them a portion of their property for the support of the
government.

Power to Tax Not Power to Destroy

According to Justice Holmes brushed aside Marshall’s view by declaring that “the power to tax is not
the power to destroy while this Court sits.

Reconciliation of Marshall’s View with Holmes View

A valid tax should not be judicially restrained merely because it would prejudice taxpayer’s property.
An illegal tax could be judicially declared invalid.
Philippine Tax Laws
National Tax Laws
NIRC and Tariff and Customs Code
Local Tax Laws
Local Government Code on Local Tax Ordinances
Miscellaneous Tax Laws

Power of Judicial Review in Taxation

As long as the legislature, in imposing a tax, does not violate applicable constitutional limitations or
restrictions, the courts cannot inquire into the wisdom of a taxing act.
The Court’s power in taxation is limited only to the application and interpretation of the law.
TAXES
A burden or charge imposed by legislative power upon persons or property to raise money
for public purposes.

CHARACTERISTICS OF TAXES
An enforced contribution
Generally payable in money
Levied on persons, property or exercise of a right or privilege
Levied by state having jurisdiction
Levied by legislature
Levied for public purpose
Paid at regular a periods or intervals

CLASSIFICATION OF TAXES
1. Personal poll or capitalization)
Imposed on all residents, whether citizens or not
Ex. Community tax
2. Property
Imposed on property Ex. property tax
3. Excise
Imposed upon performance of an act, the enjoyment of a privilege or the engaging in occupation
Ex. income tax, estate tax, donor’s tax

WHO BEARS THE BURDEN

Direct
Personal taxes due from natural persons, non-transferable.
Ex. Income tax, donor’s tax, estate tax
Indirect
Business taxes due from either natural or juridical persons transferable.
Ex. VAT, documentary stamp tax)
IMPOSING AUTHORITY
National
Taxes imposed by national government.
Ex. NIRC taxes
Local
Taxes imposed by local government units.
Ex. community taxes, business licenses and permits, professional tax, real estate tax

TAX LAWS IN GENERAL

Sources
Philippine Constitution
Existing tax laws of the Philippines (National, Local and Miscellaneous tax laws).
Escape from Taxation
Tax evasion - A tax evader breaks the law.
Tax avoidance - The tax avoider sidesteps it.

LIMITATIONS ON THE POWER OF TAXATION

There are no limitations upon the power to tax.
To prevent abuse on the exercise of the otherwise unlimited power of taxation.
To serve as a standard for determining whether a tax law or an act of the taxing authorities in the
implementation of tax laws is valid or not.
Constitutional limitations
These are the restrictions imposed by the constitution.

TAX EXEMPTIONS
An exemption from taxation may be defined as a grant of immunity, express or implied, to particular
persons or corporations from the obligation to pay taxes.

Kinds of Tax Exemptions

Constitutional Exemptions
Immunities from taxation which originate from the Constitution.
Statutory Exemptions
Are those which emanate from legislation
Selected Principles Governing Tax Exemptions
Exemptions from taxation are highly disfavored in law.
He who claims exemption should prove by convincing proof that he is exempted.
Constitutional grants of tax exemption are self-executing.
Tax exemptions are personal.

GENERAL PRINCIPLES OF INCOME TAXATION IN THE PHILIPPINES OR THE SOURCE

RULE OF INCOME TAXATION FOR AS PROVIDED IN THE NIRC OF 1997.
A citizen of the Philippines residing therein is taxable on all income derived from sources within and
without the Philippines.
A nonresident citizen is taxable only on income derived from sources within the Philippines.
An individual citizen of the Philippines who is working and deriving income abroad as an overseas
contract worker is taxable on income from sources within the Philippines.
An alien individual, whether a resident or not of the Philippines, is taxable only on income derived from
sources within the Philippines.

ISSUES ON TAXATION IN THE PHILIPPINES

Taxation started during the Spanish time in the Philippines.
The Filipinos were compelled to pay tribute for the administration of the country, construction of
churches, government buildings, roads, bridges and improvement of transportation and communication.

The tribute was 8 reales is equivalent to 12 centavos but was raised to 10 in 1602, then increased to 12 in
1851.
Those who required to pay taxes were individuals from 16 years old to 60 years old.
Unmarried man over 20 years old and unmarried women over 25 years old paid half of the tribute.

Native did not like the way the tribute was collected because the encomenderos became very wealthy
and reaped huge profit from it.
The King of Spain abolished it in 1884.
In its place the cedula served as an income tax and personal identification of the inhabitance.
The bandala is the compulsory sale of farmer’s farm products to the government, but in many cases, the
products were not paid for.
The Philippines today, there are two kinds of taxes.
National taxes are imposed by the national government through National Internal Revenue Code, Tariff
and Customs Code.
Local taxes are collected by the local government units (LGUs) based on Local government Code.

III. GLOSSARY

Taxation - a term for when a taxing authority, usually a government, levies or imposes a tax. 

Torrens title - is a land registration and land transfer system, in which a state creates and maintains a
register of land holdings, which serves as the conclusive evidence of title of the person recorded on the
register as the proprietor, and of all other interests recorded on the register. 

IV. ASSIGNMENT

How would you explain the system of taxation in the Philippines despite all items are taxed? Does it
help the government in providing the basic services to the people? Justify your answer

Psalms 90:12
Teach us to number our days that we may gain a heart of wisdom. 
FILIPINO CULTURAL HERITAGE
The Filipino culture is a summation of indigenous forces and foreign influences that had come to bear
upon the people in varying degrees during the last centuries.
This assimilated in a selective way, and this process of an acculturation varied from region to region.

The Arab influence

About 200 years before the Spanish arrived in the Philippines, the Arabs traded and settled in the
Philippines.
Words such as apo (grandchild), alamat (legend), sulat(letter) and Salamat (thank you), came from the
Arabic language.
Arabs introduced the use of calendars and Islam to the Filipinos.

The Japanese influence

The Japanese traders first settled in the archipelago during the 12th century AD.
Historical records show that Japanese traders, especially those from Nagasaki, frequently visited the
Philippine and bartered Japanese goods for such Filipino products as gold and pearls.
The relatively light complexion of Bontoc and Banaue is probably a result between the Japanese and the
natives of the Cordillera.

The Malays
The component of Filipino culture is the Malay temperament which could best be described by niceness
and pleasantness to others rather than by virtue of law abiding features.
The Malay family clan or unit is the world’s best security system.

The Chinese
Filial piety between parents and children the flexibility to go along with other people and the sageliness
within and the kingliness without of the Filipino is believed to be due to Chinese influence.

The Indian influence

Indian influence is found in the languages, mode of dressing, architectural art, beliefs, brass, and
copperware.

The Hindu influence

The most pervasive in the Filipino belief system.
For instance is the prediction of Filipino newspaper readers for horoscope and fortunetelling sections.

The Spanish heritage

It is reflective of more developed societies at their point of contact, broadened the outlook of the
Filipino.
Spain introduced a community oriented rather than a family oriented religion in the form of Christianity.
It contributed to an elite class.
A social and political organization, according to western institutions brought into the Philippines.

The Americans
This heritage by introducing a democracy that called for individual liberty and equality as well as a
national political community to which everybody to participate through national suffrage.
THE FILIPINO CULTURE
Filipinos are religious.
They believe so much in supernatural powers and view themselves as only a speck in this wide universe.
This Filipino belief in the supernatural powers taught them to trust prayers rather than hard work in the
realization of their dreams.
Success is considered a blessing from above.
It taught him to value traits like perseverance, patience, and endurance.

Value System
Values actually guide man’s behavior and action as he relates himself in most situations in life.
The Filipino values can best be seen from the aspects of personal and social relationships.
Majority of them takes care of their honor (karangalan) rather than wealth.
In decision making, the Filipinos usually consult the consensus of the family members.

THE FILIPINO VALUES

Utang-na-loob
It is a technique of reciprocity of debt of gratitude to others within the family circle or primary group,
sometimes unlimited rather than financial or rational.
Pakikisama
It is the value of belongingness and loyalty to the small in-group with sensitivity to the feelings of others
on the principle of give and take.
It is concept of good public relations and avoidance of conflict.

Filipino Indolence
Jose Rizal stated the Filipinos in general are indolent people.
There are Filipinos who do not care of their future.
They prefer to play games of chance gambling.

Hiya
A large extent the behavior of the individual and most likely, is generally dependent on what others will
think, say, and do.
Filipino cannot say “NO” even if it is against his will to do what is being requested.

Bahala na
A common expression on the fatalistic outlook and strong dependence on the spirits who will take care
of everything if they are really meant for a person.
Amor-propio
It is the individuals highly emotional reaction to protect his honor and dignity when they are threatened
or questioned and to retaliate.
Hele hele bago quire, or pakipot which shows at the outset a person initially refusing an offer even if he
really wants very much to accept it.

Ningas-Cugon
Filipinos are very eager and ready to do and finish a work but after some time, they became complacent
and lazy at the end.
It is like a cogon grass that easily kindle and burn and nothing is left.

Manana Habit
It is the tomorrow-attitude or procrastination attitude.
People set aside their work for tomorrow what they can already do today.
People can accomplish many things if they only make use of their time profitably.

Gambling
A favorite pastime of Filipinos which has more negative effects than positive ones.
Jueteng, tongits, cara y cruz, sabong are some forms of gambling that brings negative effects especially
to young ones.

Lagay and Areglo

A socio-political connections for some material consideration to be able to obtain favors.
These negative practice occurs in government offices where special privileges and favors may be
obtained in return for which certain considerations are
exchanged.
Palakasan scheme
Is a system where you are allowed to get a job without hassle only if you’re a family member, good
friends with, or referred by someone you know from the inside.
This is a common knowledge, an open secret to every Filipino, most especially in the world of politics.

SUPERSTITIONS OF THE FILIPINOS

Early Filipinos believed in Aswang (witch)
Dwende (tiny creatures like humans)
Kapre (tall and apelike usually found on trees.
Mangkukulam (an old lady capable of harming others using a doll and a pin).
Tikbalang (half-man and half-horse creature)
Tiyanak (a baby that sucks blood on human.
Believed in magical power of anting-anting, and the use of gayuma or love potion.

Gaya Gaya Practice

It refers to the Filipino imitativeness which gives rise to emphasis on façade, palabas, pakitang-tao,
pagyayabang.

Karma
A word meaning the result of a person's actions as well as the actions themselves.
What happens to a person, happens because they caused with their actions.

Fatalism
It refers to the belief that all events are naturally and supernaturally Predetermined the mental attitude of
submission to the inevitability of the power of fate or the acceptance of one’s fate with, stoicism or
lethargy.
Use of phrases such as itinalaga ng Diyos, iginuhit ng tadhana, gulong ng palad, malas, napasubo.

III. GLOSSARY
Cultural Heritage - an expression of the ways of living developed by a community and passed on from
generation to generation, including customs, practices, places, objects, artistic expressions and values. 

The culture of the Philippines comprises a blend of traditional Filipino and Spanish Catholic traditions,

with influences from America and other parts of Asia. The Filipinos are family oriented and often
religious with an appreciation for art, fashion, music and food.

IV. ASSIGNMENT

How would you explain the different cultural traits of the Filipinos? How did it affect their way of life in
the present time?

Mark 9:23
Jesus said to him, If you can believe, all things are possible to him that believes.