1. The principal purpose of taxation is
No appropriation of public money for religious
a. To encourage the growth of home industries
through the power of tax exemptions and tax
incentives.
b. To implement the police power of the state
c. The reduce excessive inequalities of wealth
d. To raise revenues for governmental needs
2. The aspects of taxation are
a. Legislative in character
b. Executive in character
c. Shared by the legislative and executive
departments
d. Judicial in character
3. Taxation as distinguished from police power and
power of eminent domain
a. Property is taken to promote the general welfare
b. May be exercised only by the government
c. Operates upon the whole citizenry
d. There is generally no limit as to the amount that
may be imposed
4. Which of the inherent powers may be exercised
even by public service corporations and public
entities
a. Power of taxation c. Power of eminent domain
b. Police power d. A and C
5. Which of the following statements is correct?
a. Income tax is an indirect tax.
b. Our National Internal Revenue Laws are
criminal in nature.
c. The theory of taxation states that the power of
taxation is supreme, plenary, unlimited, and
comprehensive.
d. Taxation is subject to inherent and constitutional
limitations.
6. This is an inherent limitation on the power of
taxation
a. Rule on uniformity and equity in taxation
b. Due process of law and equal protection of the
laws
c. Non-impairment of the jurisdiction of the
Supreme Court in tax cases
d. Tax must be for public purpose
7. This is a constitutional limitation on the power of
taxation
a. Tax laws must be applied within the territorial
jurisdiction of the state
b. Exemption of government agencies and
instrumentalities from taxation
c.
purposes
d. Power to tax cannot be delegated to private
persons or entities
8. The power to acquire private property upon
payment of just compensation for public purpose
a. Power of taxation c. Power of eminent domain
b. Police power d. Power of love
9. The power to regulate liberty and property to
promote the general welfare
a. Police power c. Power of eminent domain
b. Power of taxation d. Super power rangers
10.The tax imposed should be proportionate to the
taxpayer's ability to pay
a. Fiscal adequacy c. Administrative feasibility
b. Equality or theoretical justice d. Economic
consistency
11. The sources of revenue as a whole, should be
sufficient to meet the demands of
public expenditures -
a. Fiscal adequacy c. Administrative feasibility
b. Equality or theoretical justice d. Revenue
generation
12. The tax laws must be capable of convenient,
just and effective administration
a. Fiscal adequacy c. Administrative feasibility
b. Equality or theoretical justice d. Psychological
compatibility
13.Statement 1 —The point on which a tax is
originally imposed is impact of taxation
Statement 2 — Police power is superior to the
non-impairment clause of the constitution
Statement 3 —As a rule, taxes are subject to set-
off or compensation
Statement 4 — As a rule, provisions on the validity
of tax exemptions are resolved liberally in favor of
the taxpayer
Statement I Statement 2 Statement 3 Statement 4
a. True False False False
b. True True False True
c. True True False False
d. False True False False
14.Enforced proportional contributions from
persons and property levied by the state byvirtue
of its sovereignty for the support of the
government and for all public needs
a. Toll c. Taxes
b. License fee d. Assessment
15.Persons or things belonging to the same class
shall be taxed at the same rate
a. Simplicity in taxation c. Equality in taxation
b. Reciprocity in taxation d. Uniformity in taxation
16.Which is not an essential characteristic of a
tax?
a. It is unlimited as to amount
b. It is payable in money
c. It is proportionate in character
d. It is an enforced contribution
17.Special assessment is an enforced proportional
contribution from owners of land especially
benefited by the public improvement. Which one of
the following is not considered as one of its
characteristics?
a. It is levied on land
b. Itis based on the government's need of money
to support its legitimate objectives
c. It is not a personal liability of the persons
assessed
d. It is based solely on the benefit derived by the
owners of the land
18.Itis the privilege of not being imposed a
financial obligation to which others are subject
a. Tax incentive c. Tax amnesty
b. Tax exemption d. Tax credit
19.Asto scope of the legislative power to tax,
which is not correct?
a. Where there are no constitutional restrictions,
and provided the subjects are within the territorial
jurisdiction of the state, Congress has unlimited
discretion as to the persons, property or
occupations to be taxed.
b. In the absence of any constitutional prohibition,
the House of Representatives has the right to levy
a tax of any amount it sees fit.
c. The discretion of Congress in imposing taxes
extends to the mode, method or kind of tax, if not
restricted by the constitution.
d. The s o l e arbiter o f t h e Purpose for which
taxes shall be levied is the Commissioner of
Internal Revenue Internal Revenue (CIR),
provided the purpose is public. However, the
courts may review the levy of the tax to determine
whether or not the purpose is public.
20. Which of the following is a nature of taxation?
a. The power is exercised by legislative action
b. It is essentially an administrative function
c. It is generally payable in money
d. The state can exist without it
21. The use of illegal or fraudulent means t o avoid
or defeat the payment of tax
a. Shifting c. Avoidance
b. Exemption d. Evasion
22. The use of legal or permissible means to
minimize or avoid taxes
a. Shifting c. Avoidance
b. Exemption d. Evasion
23. Synonymous to tax evasion
a. Tax Dodging c. Tax exemption
b. Tax minimization d. Tax shield
24. Synonymous to tax avoidance
a. Tax Dodging c. Tax exemption
b. Tax minimization d. Tax evasion
25. In case of doubt, tax statutes are construed
a. Strictly against the government and the
taxpayer
b. Liberally in favor of the government and the
taxpayer
c. Strictly against the government and liberally in
favor of the taxpayer
d. Liberally in favor of the government and strictly
against the taxpayer
26. In case of doubt, tax exemptions are construed
a. Strictly against the government and the
taxpayer
b. Liberally in favor of the government and the
taxpayer
c. Strictly against the government and liberally in
favor of the taxpayer
d. Liberally in favor of the government and strictly
against the taxpayer
27. In case of conflict between the Tax Code and
the Philippine Accounting
Standards (PAS)
a. PAS shall prevail over the Tax Code
b. Tax Code shall prevail over MS
c. PAS and Tax Code shall be both disregarded
d. The taxpayer may choose between the MS or
the Tax Code
28. Tax of a fixed amount imposed upon all
persons residing within a specified territory without
regard to their property, income, or occupation
they may be engaged in
a. Personal, poll or capitation c. Excise
b. Property d. Regressive
29. Tax imposed on personal or real property in
proportion to its value or on some other
reasonable method of apportionment
a. Personal, poll or capitation c. Excise
b. Property d. Regressive
30. Tax imposed upon the performance of an act,
the enjoyment of privilege or the engaging in an
occupation.
a. Personal, poll or capitation c. Excise
b. Property d. Progressive
31. Tax which is demanded from the person whom
the law intends or desires to pay it
a. Direct b. Indirect c. Excise d. Income
32. Tax which is demanded from one person in the
expectation and intention that he shall indemnify
himself at the expense of another
a. Direct b. Indirect c. Property d. Income
33. Tax which imposes a specific sum by the head
or number or by some standard of weight or
measurement and which requires no assessment
other than a listing or classification of the objects
to be taxed
a. Specific b. Ad-valorem c. Excise d. Income
34. Tax of a fixed proportion of the amount or
value of the property with respect to which the tax
is assessed
a. Specific c. Excise
b. Ad-valorem d. Percentage
35. Tax based on a fixed percentage of the amount
of property, income or other basis to be taxed
a. Proportional c. Regressive
b. Progressive d. Indirect
36. Tax where the rate decreases as the tax base
increases
a. Proportional b. Progressive
c. Regressive d. Indirect
37. Tax where the rate increases as the tax base
increases
a. Proportional b. Progressive
c. Regressive d. Indirect
38. Which of the following statements is not
correct?
a. Tax burdens shall neither be imposed nor
presumed to be imposed beyond what the statute
expressly and clearly states because tax statutes
should be construed strictly against the
government.
b. Tax exemptions, tax amnesty, tax condonations
and their equivalent provisions are not presumed
and, when granted, are strictly construed against
the taxpayer because such provisions are highly
disfavored by the government.
c. Exemptions from taxation arc highly disfavored
in law and he who claims tax exemption must be
able to justify his claim or right.
d. The Bureau of Internal Revenue has the duty
and the exclusive power of enacting, implementing
and interpreting tax laws.
39. The strongest of all inherent powers of the
state because without it, the government can
neither survive nor dispense any of its other
powers and functions effectively.
a. Police Power c. Power of Taxation
b. Power of Eminent Domain d. Power of
Greystone
40.This power is superior to the non-impairment
clause and is broader inapplication because it is
the power to make and implement the laws.
a. Power of Taxation c. Power of Eminent Domain
b. Power of Recall d. Police Power
41. Which of the following statements is not
correct?
a. An inherent limitation of taxation may be
disregarded by the application ofa constitutional
limitation.
b. Income tax liabilities shall be paid by the
inhabitants even if foreign invaders occupy our
country.
c. Taxes may be imposed retroactively by law, but
unless so expressed by such law, these taxes
must only be imposed prospectively.
d. Tax laws are either political or penal in nature.
42.Which of the following is not a constitutional
limitation on the Power of Taxation?
a. No person shall be deprived of life, liberty or
property without due process of law.
b. No person shall be denied the equal protection
of the law.
c. No person shall be imprisoned for debt or non-
payment of tax.
d. No law granting any tax exemption shall be
passed without the concurrence of a majority of all
the members of Congress.
43.The distinction of a tax from permit or license
fee is that a tax is:
a. Imposed for regulation.
b. One which involves an exercise of police power. c. Compensation/benefit is received;
c. One in which there is generally no limit onthe d. Are legislative in character.
amount that may be imposed.
d. Limited to the cost of regulation.

44.Police power as distinguished from the power

of eminent domain:
a. Just compensation is received by the owner of
the property.
b. May be exercised by private individuals.
c. May regulate both liberty and property
d. Property is taken by the government for
public purpose.

45. A tax wherein both the impact of or the liability

for the payment of the tax as well as the burden of
the tax falls on the same person.
a. Direct tax b. VAT c. indirect tax d. Percentage
tax

46. Which one of the following is not a

characteristic or element of a tax?
a. It is an enforced contribution.
b. It is legislative in character.
c. It is based on the ability to pay.
d. It is payable in money or in kind.

47. Tax as distinguished from license fees:

a. Limited to cover cost of regulation.
b. A regulatory measure.
c. Non-payment does not necessarily render the
business illegal
d. Imposed in the exercise of police power
48. The power to impose taxes is exercised by
the
a. President b. Supreme Court
c. BIR d. Congress

49.One of the characteristics of internal revenue

laws is that they are:
a. Criminal in nature c. Political in nature
b. Penal in nature d. Generally. prospective in
application

50. Which of the following is not an example of

excise tax:
a. Transfer tax; b. Sales tax
c. Real property tax d. Income tax

51. The following are similarities of the inherent

power of taxation, eminent domain, and police
power, except one:
a. Arc necessary attributes of sovereignty;
b. Superior to the non-impairment clause of the
constitution