NOTES IN TAXATION
NOTES IN TAXATION
Taxation- process or means by which the sovereign, through its lawmaking body, raises income to defray necessary expenses of the government; power of the State, inherent in sovereignty -indispensable and inevitable price for civilized society, without taxes, government would be paralyzed.
Taxes- lifeblood of the government and their prompt and certain availability are an imperious need.
Objectives of Taxation:
Shifting wealth from the rich to the poor
Maintaining price stability
Stimulating economic growth
Encouraging full employment
State Powers:
Taxation- power of the state by which the sovereign raises revenue to defray the necessary expenses of the government.
Eminent Domain- the power of the State to take private property for public use upon payment of just compensation.
Police power- the power of the State to enact laws to promote public health, public morals, public safety and the general welfare of the people.
Aspects of Taxation:
Levying of the tax- requires legislative function
Collection of the tax levied- administrative function
Basic Principles of a Sound Tax System
a. Fiscal adequacy- sources of revenue are sufficient to meet government expenditures.
b. Equality or theoretic justice- tax imposed must be proportionate to taxpayer’s ability to pay.
c. Administrative feasibility- the law must be capable of convenient, just and effective administration.
Limitations on the power of Taxation:
Constitutional limitations- provided for in the Constitution or implied from its provision.
Inherent limitations- are restrictions to the power to tax attached to its nature.
INHERENT LIMITATIONS:
Purpose- taxes may be levied only for public purpose
Territoriality- the State may tax persons and properties under its jurisdiction.
International comity- the property of a foreign State may not be taxed by another.
Exemption- governmental agencies performing governmental functions are exempt from taxation.
Non-delegation- the power to
Taxation- process or means by which the sovereign, through its lawmaking body, raises income to defray necessary expenses of the government; power of the State, inherent in sovereignty -indispensable and inevitable price for civilized society, without taxes, government would be paralyzed.
Taxes- lifeblood of the government and their prompt and certain availability are an imperious need.
Objectives of Taxation:
Shifting wealth from the rich to the poor
Maintaining price stability
Stimulating economic growth
Encouraging full employment
State Powers:
Taxation- power of the state by which the sovereign raises revenue to defray the necessary expenses of the government.
Eminent Domain- the power of the State to take private property for public use upon payment of just compensation.
Police power- the power of the State to enact laws to promote public health, public morals, public safety and the general welfare of the people.
Aspects of Taxation:
Levying of the tax- requires legislative function
Collection of the tax levied- administrative function
Basic Principles of a Sound Tax System
a. Fiscal adequacy- sources of revenue are sufficient to meet government expenditures.
b. Equality or theoretic justice- tax imposed must be proportionate to taxpayer’s ability to pay.
c. Administrative feasibility- the law must be capable of convenient, just and effective administration.
Limitations on the power of Taxation:
Constitutional limitations- provided for in the Constitution or implied from its provision.
Inherent limitations- are restrictions to the power to tax attached to its nature.
INHERENT LIMITATIONS:
Purpose- taxes may be levied only for public purpose
Territoriality- the State may tax persons and properties under its jurisdiction.
International comity- the property of a foreign State may not be taxed by another.
Exemption- governmental agencies performing governmental functions are exempt from taxation.
Non-delegation- the power to