TAXATION

PRESENTED BY: MS. MARY JOY AMARO

• A tax is a mandatory fee
or financial charge levied
by any government on an
individual or an
organization to collect
revenue for public works
providing the best
facilities and
infrastructure.
TAXATION DEFINES AS..

• Taxation refers to the
practice of a government
collecting money from its
citizens to pay for public
services.
• Taxation is the practice of
collecting taxes (money)
from citizens based on their
earnings and property.  
CONCEPT OF TAXATION

• Taxation is the inherent power of the state to impose and demand contribution upon
persons, properties, or rights for the purpose of generating revenues for public
purposes.
• Taxes are enforced proportional contributions from persons and property levied by
the lawmaking body of the state by virtue of its sovereignty for the support of the
government and all public needs
ESSENTIAL CHARACTERISITICS OF TAX

• It is an enforced contribution
• It is generally payable in money.
• It is proportionate in of the state.
• It is levied pursuant to legislative authority, the power character, usually based on the
ability to pay.
• It is levied on persons and property within the jurisdiction o tax can only be exercised
by the law making body or congress.
• It is levied for public purpose.
• It is commonly required to be paid a regular intervals.
 illustrated as:

BASIS OF TAXATION

PUBLIC SERVICES

GOVERNMENT PEOPLE

TAXES
THEORIES OF COST ALLOCATION

• Benefit based theory

It is the presupposes that the more benefit one receives from the government, the more
taxes he should pay.

• Ability to pay
It presupposes that taxation should also consider the taxpayer’s ability to pay.Taxpayers
should be required to contribute based on their relative capacity to sacrifice for the support of
the government.
ASPECTS OF THE ABILITY TO PAY THEORY

• Vertically equity
Proposes that the extent of one’s ability to pay is directly proportional to the level of his tax base.

• Horizontal equity
Requires consideration of the particular circumstance of the taxpayer.
Vertical Equity

₱200,000 ₱400,000
Horizontal Equity

₱300,000 ₱300,000
THE LIFEBLOOD DOCTRINE

• Taxes are essential and indispensable to the continued subsistence of the government.
Without taxes, the government would be paralyzed for lack of motive power to activate or
operate it. (CIR vs. Algue)

• Taxes are the lifeblood of the government, and their prompt and certain availability are an
imperious need. Upon taxation depends the government’s ability to serve the people for
whose benefit taxes are collected. (Vera vs. Fernandez)
Question…

• As a citizen, what can you say about the government’s

implementation of taxation in Philippines?