Test Bank for Tax Principles, 2025|2026 Both
Questions and answers.
Taxation as distinguished from police power and power of eminent domain.
A. Property is taken to promote the general welfare.
B. Maybe 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 - answersD
The following are constitutional limitations, except
A. No imprisonment for non-payment of poll tax.
B. Non-impairment of the obligation of contracts.
C. Rule of uniformity and equity in taxation.
D. Exemption from income tax of charitable institutions, cemeteries, churches,
personage or convents appurtenant thereto, as well as all lands, buildings and
improvements actually, directly and exclusively used for religious, charitable and
educational purposes. - answersD
Which of the following statements is correct?
A. The President is authorized to increase or decrease national internal revenue tax
rates.
B. One of the nature of taxation is the reciprocal duties of protection and support
between
the state and subjects thereof.
C. Every sovereign government has the inherent power to tax.
D. Income tax in an indirect tax - answersC
A tax must be imposed for public purpose. Which of the following is not a public
purpose?
A. National defense
B. Public education
C. Improvement of the sugar and coconut industries.
D. Improvement of a subdivision road - answersD
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 - answersA
Special assessment is an enforced proportional contribution from owners of land
especially benefited by public improvement. Which one of the following is not
considered as one of its characteristics?
A. It is levied on land.
B. It is 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. - answersB
It is the privilege of not being imposed a financial obligation to which others are subject.
A. Tax incentive
B. Tax exemption
C. Tax amnesty
D. Tax credit - answersB
As to 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, Congress 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, unless restricted by the constitution.
D. The sole arbiter of the purpose or which taxes shall be levied is Congress, provided
the purpose is public and the courts may not review the levy of the tax to determine
whether or not the purpose is public - answersD
Which of the following is a nature of taxation?
A. The power is granted by legislative action.
B. It is essentially an administrative function.
C. It is generally payable in money.
D. Without it the state can continue to exist. - answersA
Which of the following is not a determinant of the place of taxation?
A. Source of the income
B. Citizenship of the taxpayer
C. Residence of the taxpayer
D. Amount of tax to be imposed - answersD
Which of the following statements is not correct?
,A. An inherent limitation of taxation may be disregarded by the application of a
constitutional limitation.
B. The property of an educational institution operated by a religious order is exempt
from
property tax, but its income is subject to income tax.
C. The prohibition of delegation by the state of the power of taxation will still allow the
BIR to modify the rules in time for filing of returns and payment of taxes.
D. The power of taxation is shared by the legislative and executive departments of the
government - answersC
Statement 1 - The point on which tax is originally imposed is impact of taxation.
Statement 2 - Eminent domain is inferior to 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 1Statement 2Statement 3Statement 4
A. True False False True
B. False True True False
C. True True False False
D. False False True True - answersC
A tax system where the revenues are supplied mostly by indirect taxes.
A. Schedular C. Progressive
B. Proportional D. Regressive - answersD
A tax system where the greater bulk of the tax revenues is derived by direct taxes.
A. Schedular C. Progressive
B. Proportional D. Regressive - answersC
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 the public purpose - answersD
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. No appropriation of public money for religious purposes.
D. Power to tax cannot be delegated to private persons or entities. - answersC
, They exist independent of the constitution being fundamental powers of the state,
except
A. Power of taxation
B. Power of imminent domain
C. Police power
D. Power of recall - answersD
he power to acquire private property upon payment of just compensation for public
purpose
A. Power of taxation
B. Power of imminent domain
C. Police power
D. Power of recall - answersB
The power to regulate liberty and property to promote the general welfare.
A. Power of taxation
B. Power of imminent domain
C. Police power
D. Power of recall - answersC
The power to demand proportionate contributions from persons and property to defray
the expenses of the government.
A. Power of taxation
B. Power of imminent domain
C. Police power
D. Power of recall - answersA
Basic Principles of a sound tax system, except
A. Fiscal adequacy
B. Administrative feasibility
C. Equality or theoretical justice
D. Intellectual sensitivity - answersD
The tax imposed should be proportionate to the taxpayer's ability to pay.
A. Fiscal adequacy
B. Administrative feasibility
C. Equality or theoretical justice
D. Intellectual sensitivity - answersC
Questions and answers.
Taxation as distinguished from police power and power of eminent domain.
A. Property is taken to promote the general welfare.
B. Maybe 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 - answersD
The following are constitutional limitations, except
A. No imprisonment for non-payment of poll tax.
B. Non-impairment of the obligation of contracts.
C. Rule of uniformity and equity in taxation.
D. Exemption from income tax of charitable institutions, cemeteries, churches,
personage or convents appurtenant thereto, as well as all lands, buildings and
improvements actually, directly and exclusively used for religious, charitable and
educational purposes. - answersD
Which of the following statements is correct?
A. The President is authorized to increase or decrease national internal revenue tax
rates.
B. One of the nature of taxation is the reciprocal duties of protection and support
between
the state and subjects thereof.
C. Every sovereign government has the inherent power to tax.
D. Income tax in an indirect tax - answersC
A tax must be imposed for public purpose. Which of the following is not a public
purpose?
A. National defense
B. Public education
C. Improvement of the sugar and coconut industries.
D. Improvement of a subdivision road - answersD
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 - answersA
Special assessment is an enforced proportional contribution from owners of land
especially benefited by public improvement. Which one of the following is not
considered as one of its characteristics?
A. It is levied on land.
B. It is 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. - answersB
It is the privilege of not being imposed a financial obligation to which others are subject.
A. Tax incentive
B. Tax exemption
C. Tax amnesty
D. Tax credit - answersB
As to 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, Congress 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, unless restricted by the constitution.
D. The sole arbiter of the purpose or which taxes shall be levied is Congress, provided
the purpose is public and the courts may not review the levy of the tax to determine
whether or not the purpose is public - answersD
Which of the following is a nature of taxation?
A. The power is granted by legislative action.
B. It is essentially an administrative function.
C. It is generally payable in money.
D. Without it the state can continue to exist. - answersA
Which of the following is not a determinant of the place of taxation?
A. Source of the income
B. Citizenship of the taxpayer
C. Residence of the taxpayer
D. Amount of tax to be imposed - answersD
Which of the following statements is not correct?
,A. An inherent limitation of taxation may be disregarded by the application of a
constitutional limitation.
B. The property of an educational institution operated by a religious order is exempt
from
property tax, but its income is subject to income tax.
C. The prohibition of delegation by the state of the power of taxation will still allow the
BIR to modify the rules in time for filing of returns and payment of taxes.
D. The power of taxation is shared by the legislative and executive departments of the
government - answersC
Statement 1 - The point on which tax is originally imposed is impact of taxation.
Statement 2 - Eminent domain is inferior to 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 1Statement 2Statement 3Statement 4
A. True False False True
B. False True True False
C. True True False False
D. False False True True - answersC
A tax system where the revenues are supplied mostly by indirect taxes.
A. Schedular C. Progressive
B. Proportional D. Regressive - answersD
A tax system where the greater bulk of the tax revenues is derived by direct taxes.
A. Schedular C. Progressive
B. Proportional D. Regressive - answersC
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 the public purpose - answersD
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. No appropriation of public money for religious purposes.
D. Power to tax cannot be delegated to private persons or entities. - answersC
, They exist independent of the constitution being fundamental powers of the state,
except
A. Power of taxation
B. Power of imminent domain
C. Police power
D. Power of recall - answersD
he power to acquire private property upon payment of just compensation for public
purpose
A. Power of taxation
B. Power of imminent domain
C. Police power
D. Power of recall - answersB
The power to regulate liberty and property to promote the general welfare.
A. Power of taxation
B. Power of imminent domain
C. Police power
D. Power of recall - answersC
The power to demand proportionate contributions from persons and property to defray
the expenses of the government.
A. Power of taxation
B. Power of imminent domain
C. Police power
D. Power of recall - answersA
Basic Principles of a sound tax system, except
A. Fiscal adequacy
B. Administrative feasibility
C. Equality or theoretical justice
D. Intellectual sensitivity - answersD
The tax imposed should be proportionate to the taxpayer's ability to pay.
A. Fiscal adequacy
B. Administrative feasibility
C. Equality or theoretical justice
D. Intellectual sensitivity - answersC
