I.

General Principles of Taxation

A. Taxation, Defined
1. Definition 2. Nature and Characteristics
B. Taxation Power, Compared with Other Powers of the State
1. Police Power 2. Power of Eminent Domain
C. Characteristics of a Sound Tax System
1. Fiscal Adequacy 2. Administrative Feasibility 3. Theoretical Justice
D. Limitations to the Power of Taxation
1. Inherent
i. Public Purpose ii. Non-delegability iii. Exemption of Government iv. International
Comity v. Situs/Jurisdiction
2. Constitutional
i. Implied ii. Express
E. Distinction from Other Kinds of Payment
1. Debt 2. License Fee 3. Special Assessment 4. Toll 5. Penalty
F. Classification of Taxes
1. As to the Imposing Authority
i. Local ii. National
2. As to the Person Destined to Pay it
i. Direct ii. Indirect
3. As to Its Object
i. Personal ii. Property iii. Excise
4. As to Purpose
i. Fiscal ii. Regulatory
5. As to Application
i. Special ii. General
6. As to the Tax Base
i. Specific ii. Ad Valorem
7. As to Rate
i. Progressive ii. Proportional iii. Regressive
8. Forms of Escape from Taxation
i. Tax Evasion ii. Tax Avoidance

II. Income Taxation

A. Income, Defined
B. Systems of Taxation
1. Global/Unitary 2. Schedular Approach
C. Taxable Period
1. Fiscal Year 2. Calendar
D. Three Kinds of Income
1. Compensation Income 2. Gross/Business Income 3. Income Subject to Final Tax/Passive
Income
E. Exclusions, Concept of
1. Proceeds of Life Insurance 2. Return of Premiums 3. Compensation for Injuries/Sickness 4.
Gifts, Bequests, & Devises 5. Retirement Benefits, Pensions, Gratuities 6. Interest on Government
Securites 7. 13th month pay and other benefits to the extent of P30,000 8. Misc. Items
F. Deductions
1. Exemptions, defined
 i. Personal ii. Additional
2. Itemized Deductions for Individual Taxpayers
3. Optional Standard Deduction
G. Formula in Computing Individual Income Tax
1. Filipino citizens
i. Resident ii. Non-Resident
2. Aliens
i. Resident ii. Non-Resident
H. The Withholding Tax System
I. Corporate Income Tax
1. Resident 2. Non-Resident
J. Tax On Estates and Trusts
K. Filing of Return and Payment of Tax

III. The Value-Added Tax

1. Concept
2. VAT & the Old System
3. The Operation of the Value-Added Tax System
i. Imposition of the tax ii. The Input and Output Tax iii. Exempt Transactions
IV. Excise Taxes
1. Articles Subject to Excise Taxes
i. Specific Taxes ii. Ad Valorem
2. Accrual; Computation and Payment

V. Other Percentage Taxes

1. Who are subject; Tax Base and Rate
2. Return and Payment of the Tax
VI. Documentary Stamp Tax
1. Who are required to pay; Documents subject to tax
2. Effect of non-payment
VII. Community Tax Certificate
1. Persons subject to tax; time and manner of payment

Learning Activities: Lecture, Recitation, Class Discussion