TAXATION 1 – Income Taxation

21. Basic Principles of a sound tax system, except

A. Fiscal adequacy C. Administrative feasibility
B. Equality or theoretical justice D. Intellectual sensitivity

22. 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. Intellectual sensitivity

23. 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. Intellectual sensitivity

24. The tax laws must be capable of convenient, just and effective administration.
A. Fiscal adequacy C. Administrative feasibility
B. Equality or theoretical justice D. Intellectual sensitivity

25. 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

26. The tax should be proportional to the relative value of the property to be taxed.
A Simplicity in taxation C. Equality in taxation
B. Reciprocity in taxation D. Uniformity in taxation

27.The following are the nature of taxation, except

A. Inherent in sovereignty
B. Essentially legislative in character
C. Subject to inherent and constitutional limitation
D. Subject to approval by the people.

28. It literally means “place of taxation”; the country that has the power and jurisdiction to levy
and collect the tax.
A. Basis of taxation C. Scope of taxation
B. Situs of taxation D. Theory of taxation

29. The existence of the government is a necessity and that the state has the right to compel all
individuals and property within its limits to contribute
A. Basis of taxation C. Scope of taxation
B. Situs of taxation D. Theory of taxation

30. The reciprocal duties of support and protection between the people and the government.
A. Basis of taxation C. Scope of taxation
B. Situs of taxation D. Theory of taxation

31. Subject to inherent and constitutional limitations, the power of taxation is regarded as
supreme, plenary, unlimited and comprehensive.
A. Basis of taxation C. Scope of taxation
B. Situs of taxation D. Theory of taxation

32. Our National Internal Revenue Laws are

A. Political in nature C. Criminal in nature
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B. Penal in nature D. Civil in nature

33. The levying or imposition of tax and the collection of the tax are processes which constitute
the taxation system.
A. Basis of taxation C. Nature of taxation
B. Aspects of taxation D. Theory of taxation

34. The process or means by which the sovereign, through its law-making body raises income to
defray the expenses of the government.
A. Toll C. Taxation
B. License fee D. Assessment

35. Enforced proportional contributions from persons and property levied by the state by virtue
of its sovereignty for the support of the government and for all public needs.
A. Toll C. Taxes
B. License fee D. Assessment

36. An escape from taxation where the tax burden is transferred by the one on whom the tax is
imposed or assessed to another.
A. Shifting C. Transformation
B. Exemption D. Capitalization

37. An escape from taxation where the producer or manufacturer pays the tax and endeavors to
recoup himself by improving his process of production thereby turning out his units of
products at a lower cost.
A. Shifting C. Transformation
B. Exemption D. Capitalization

38. An escape from taxation where there is a reduction in the price of the taxed object equal to the
capitalized value of future taxes which the taxpayer expects to be called upon to pay.
A. Shifting C. Transformation
B. Exemption D. Capitalization

39. The use of illegal or fraudulent means to avoid or defeat the payment of tax.
A. Exemption C. Avoidance
B. Shifting D. Evasion

40. The use of legal or permissible means to minimize or avoid taxes.

A. Exemption C. Avoidance
B. Shifting D. Evasion