TAX PRINCIPLES FINAL PAPER FULL
QUESTIONS AND CORRECT ANSWERS
ALREADY PASSED
●● The 3 Inherent Powers of the State (Essential/Fundamental)
Answer: 1. Police Power
2. Power of Taxation
3. Power of Eminent Domain
●● Police Power
Answer: It is the power of the state for promoting public welfare by
restraining and regulating the use of liberty and property.
●● Power of Taxation
Answer: It is the power by which the State raises revenue to defray the
necessary expenses of the government.
●● Power of Eminent Domain
Answer: It is the power of the state to acquire private property for public
purposes upon payment of just (fair value) compensation.
●● Similarities among the Three (3) Inherent Powers of the State
,Answer: 1. They are inherent in the State.
2. They exist independently of the constitution although the conditions
for which their exercise may be prescribed by the constitution.
3. Ways by which the State interfere with private rights and property.
4. Legislative in nature and character
5. Presuppose an equivalent compensation received, directly or
indirectly, by the persons affected.
●● Primary Purpose of Taxation
Answer: to provide funds or property with which to promote the general
welfare and the protection of its citizens and to enable it to finance its
multifarious activities.
●● Secondary Purpose of Taxation
Answer: as a devise for regulation or control (implementation of State's
police power) by means of which certain effects or conditions
envisioned by the government may be achieved such as:
(1) Promotion of General Welfare
(2)Reduction of Social Inequality
(3) Economic Growth
●● Necessity Theory
Answer: The power of taxation proceeds upon the theory that the
existence of the government is a necessity.
, ●● Lifeblood Doctrine
Answer: The power of taxation is essential because the government can
neither exist nor endure without taxation.
●● Reciprocity Theory
Answer: The state collects taxes from the subjects of taxation in order
that it may be able to perform the functions of government. The citizens,
on the other hand, pay taxes in order that they may be secured in the
enjoyment of the benefits of organized society.
●● Doctrine of Symbiotic Relationship
Answer: "Taxes are what we pay for civilized society."
●● Manifestation of the Lifeblood Theory
Answer: (1) Rule of "No estoppel against the government"
(2) Collection of taxes cannot be enjoined (stopped) by injunction
(3) Taxes could not be subject of compensation or set off.
(4) Right to select objects (subjects) of taxation.
(5) A valid tax may result in the destruction of the tax payer's property
especially on excise tax
●● Estoppel
QUESTIONS AND CORRECT ANSWERS
ALREADY PASSED
●● The 3 Inherent Powers of the State (Essential/Fundamental)
Answer: 1. Police Power
2. Power of Taxation
3. Power of Eminent Domain
●● Police Power
Answer: It is the power of the state for promoting public welfare by
restraining and regulating the use of liberty and property.
●● Power of Taxation
Answer: It is the power by which the State raises revenue to defray the
necessary expenses of the government.
●● Power of Eminent Domain
Answer: It is the power of the state to acquire private property for public
purposes upon payment of just (fair value) compensation.
●● Similarities among the Three (3) Inherent Powers of the State
,Answer: 1. They are inherent in the State.
2. They exist independently of the constitution although the conditions
for which their exercise may be prescribed by the constitution.
3. Ways by which the State interfere with private rights and property.
4. Legislative in nature and character
5. Presuppose an equivalent compensation received, directly or
indirectly, by the persons affected.
●● Primary Purpose of Taxation
Answer: to provide funds or property with which to promote the general
welfare and the protection of its citizens and to enable it to finance its
multifarious activities.
●● Secondary Purpose of Taxation
Answer: as a devise for regulation or control (implementation of State's
police power) by means of which certain effects or conditions
envisioned by the government may be achieved such as:
(1) Promotion of General Welfare
(2)Reduction of Social Inequality
(3) Economic Growth
●● Necessity Theory
Answer: The power of taxation proceeds upon the theory that the
existence of the government is a necessity.
, ●● Lifeblood Doctrine
Answer: The power of taxation is essential because the government can
neither exist nor endure without taxation.
●● Reciprocity Theory
Answer: The state collects taxes from the subjects of taxation in order
that it may be able to perform the functions of government. The citizens,
on the other hand, pay taxes in order that they may be secured in the
enjoyment of the benefits of organized society.
●● Doctrine of Symbiotic Relationship
Answer: "Taxes are what we pay for civilized society."
●● Manifestation of the Lifeblood Theory
Answer: (1) Rule of "No estoppel against the government"
(2) Collection of taxes cannot be enjoined (stopped) by injunction
(3) Taxes could not be subject of compensation or set off.
(4) Right to select objects (subjects) of taxation.
(5) A valid tax may result in the destruction of the tax payer's property
especially on excise tax
●● Estoppel
