TAX QUIZ QUESTIONS

1. Abusayaf Tax Code nagimpose ng business tax sa sang city sa Mindanao. Other than Abusayaf Tax Code, the same is
already subject to NIRC and local government tax law. Dr, Pachero paid P125,000 for that business tax. As a result, there
was overpayment of taxes. In Abusayaf tax Code, no period was provided in filing the tax refund. Can he now claim for
the tax refund? If yes, in what period?
2. Bill in the Congress for imposition of tax in the amount of 20 centavo upon plastic bags for environmental protection. Is the
bill valid? (Suggested answer: YES, Gomez vs Palomar case)
3. Ocampo is a businessman in Laguna. There was a Revenue Regulation stating that all those paying 25% higher than the
previous taxable year shall enjoy last priority investigation. Congressman question saying that it is a form of tax amnesty
which the secretary of finance cannot do. What do you think is the basis of the Congressman. If you were the Secretary of
Finance. how would you defend it?
1. (Suggested answer: Constitutional provision that tax exemption must be approved by the absolute majority of
the Congress, Article 6)
2. Secretary of Finance may content that the last priority investigation is not a form of tax exemption because all
return are still subject to investigation. It is just that those who filed 25% higher has to be preferred last.
4. Ramon Uy has an agricultural land. May VAT Revenue Regulation, hindi alam kung VAT taxpayer sya or hindi. Mr. Uy
asked a Bedan lawyer. Sabi nya VAT taxpayer sya. Pero kayong dalawa (Mr. Uy and Bedal lawyer) hindi mo sure. if you
file a return, you will suffer onerous consequences. Decide. (medyo malabo ung pagkaconstruct nung tanning)
- Ask CPA
5. A member of the Congress acting on the informations from unimpeachable sources that religious institutions and
churches has so much income emanating from religious activities and other sources proposed to impose taxes on the
said income and also to collect realty taxes on their real properties. The proposal is intended to raise more revenues for
the government which is in dire need of the revenues to address the fiscal aqequacy needs of the country. It was also
argued that these religious institutions have the financial capacity to pay and requiring them to share in the burdens of the
govenrment conforms with the theoretical justice rule which i one of the basic principles of a sound tax system. As counsel
working in the office of this member of Congress, you are required to reinforce the positions espoused by your boss. How
will you handle this assignment?
6. Flexible Tariff Clause
- The congress may, by law, authorize the President to fix within specified limits, and subject to such limitations and
restrictions as it may impose, TITO within the framework of national development program of the Government
7. Reinvestigation. 2010 nagfile ng return. Motion for Reinvestigation granted nung 2011. Natapos investigation ng 2014.
Prescribed na ba yung assessment?
- No, reinvestigation tolls the statute of limitations because it entails reception and evaluation of additional evidence
which will take more time than reconsideration which is limited to evidence already at hand (CIR vs Phil Global
Communication)
8. Electric Company subject sa franchise tax. Then, may law na nagiimpose ng income tax sa companies na may franchise.
Required ba magpay yung mga electric company?
- YES. Franchise is mere privilege given by the government. It is revocable at will.
9. Contract entered into by LBC and DOH. Nagagree na exempted sa vat yung transactions nila from 2010 to 2014. Nung
2013, nagkaroon ng law na nagrrevoke ng tax exemptions sa mga carriers. Valid ba law?
- N. Pantranco Case. Violates non-impairment of contracts.
10. 4000sqm na lupa ng church. 300sqm lang ginagamit sa church mismo, then nagdecide yung mga priests na magtayo ng
veggie garden for personal consumption. Sabi ng tax assessor, liable yun sa realty tax. Decide.
11. PLDT was granted a tax privilege of 3% by the government "in lieu of taxes". LGu of laguna passed an ordinance
imposing a tax in all businesses enjoying a franchise privilege.. Is PLDT exempted or not..
- Not exempted. Exemption was granted prior to the effectivity of the LGC which withdraws all franchises granted
before its enactment.
12. Corporation was penalized for tax evasion. Corporation moved for dismissal because of prematurity for the absence of tax
deficiency assessment. DOJ insist that tax deficiency assessment is not a pre-condition. IS DOJ correct?
- Yes. DOJ is correct. Ungas vs Cusi
13. A corporation was granted a tax exemption on the issuance of bonds and operation of public utilities. Congress revoked
the exemptions before expiry. Is the revocation constitutional?
14. City of manila imposed occupation tax on all persons exercising various professions. Atty batas paid his taxes with protest
saying that the ordinance is discriminatory. Discuss with reasons
- Valid ordinance.
15. Mr reyes real estate businessman filed his 1994 income tax return on march 25, 1995. On december 10, 1995 he left for
canada as an immigrant.After investigation on the said return, bir sent notice of assessment to mr reyes on april 10, 1998
and posted the tax delinquents (including him). On december 8, 1995 when he came back as a balikbayan, upon knowing
the same, filed a protest stating that the assessment has already presribed and that he did not receive the notice of
assessment. Will the protest prosper?
 - No. Prescriptive period was suspended when he left the PH.
16. Premature filing DOJ tax evasion
17. City of quezon city promulgated ordinance imposing a garbage fee on all household within the city due to the recent trend
in waste mgmt and the increase in waste production by 0.66 kilogram. Is the ordinance violative of equal protection clause
and due process clause guaranteed by the constitution? Discuss
18. Davao city imposed 0.5 percent of the assessed value of urban land which exceeds 100k as socialized housing tax. does
it violate due process because it is discriminatory or oppressive thus unconstitutional? Explain.
19. Someone asked a tax related law to the doj. Upon meticulous and deep research the doj produced a formal legal opinion
upon the matter. What is the probative effect of the legal opinion to BIR. Explain.
20. The church has 2-hectars of land. In the middle and in the south is the church and the convent. Southeastern commercial
establishments. Northeastern idle and unoccupied. Could the entire parcel of land be tax exempt? Explain.
- Commercial establishments not exempt
21. The president of the philippines imposed additional 8% tax to tariff pursuant to the flexible tariff clause. It immediately
became effective. Kenny contended that the law is void because there was no recommendation from th NEDA as
provided in section 401 of the tariff code. Is Kenny's contention valid? Explain.
22. Macheco Corporation was the recipient in 2005 of 2 tax exemptions both from Congree, one law exemptiong the
company’s bond issues from taxes and other exempting the company from taxes in the operation of its public utilities. The
two laws extending the tax exemptions were revoked by the Congress before their expiry dates. Were the revocations
constitutional?
23. Joey Guilas, who is engaged in the trading business, entrusted to his accountant Melencio Caunan the preparation of his
income tax return and the payment of the tax due. The accountant filed a falsified tax return by underdeclating the sales
and overstating the expense deductions of Joey. Is Joey liable for the deficiency tax and penalties thereon? What is the
liability, if any, of the accountant? Discuss.
- Yes. Wilfull blindedness doctrine
24. In view of the unfavorable balance of payment condition and the increasing budget deficit, the Pres. of the PH upon
recommendation of the NEDA issues during a recess of Congress an Executive Order imposing an additional duty on all
imports at the rate of 10% ad valorem. The EO also provides that the same shall take effect immediately. Carlito Viniegra,
an importer, questions that legality of the EO on the gowned that only Congress has the authority to fix the rates of import
taxes and in any event such an EO can take effect only 30 days after promulgation and the Pres has no authority to
shorten the sad period. Are the objections of Carlito tenable? Explain.
25. Mr Benny Ancheta is a pastor of a Protestant Church in Sorsogon whose way of evangelisation was to distribute bibles to
people whom he is evangelizing telling them the importance of reading the bible to deepen their faith in God. However,
when he gives bible to the people whom he evangelizes, he collect the amount of Php100 representing he const of the
paper, ink and related printing expenses but there is no profit realised from such activities. It was just a plain cost
recovery. The LGU of Sorsogon passed an ordinance requiring the sale of all commodities within the town which includes
bible to 3% sales tax based on gross receipts. The pastor refused to pay the tax since accdng, to him he is not engaged in
business when he distributes bible and collects Php100 per bible. Should a sales tax be imposed on his distribution of
bible, the tax will diminish the proceeds necessary to print another bible and will affect his evangelization activity. Decide
whether the Local Govt is correct in enforcing the collection of the sales tax pursuant to the ordinance. Explain
- American Bible Society
26. Mr, Butchoy, a leading investor filed his ITR on 4/15/2013 for taxable yr 2012. on 11/5/2013 he received a letter notice
from BIR RDO, Muntinlupa requiring him to submit his books of accounts and all other documentary evidences which
were used in preparing his tax return. While evaluating his documents for submission to the BIR he noticed that he
committed an error in the return he filed on 4/15/2013 for having deducted as transportation expense a personal expense
representing airfares of his family incurred during their pilgrimage to Our Lady of Akita in Japan. He decided to correct
said error by filing an amended ITR with the BIR attaching therewith the tax return earlier filed on 4/15/2013. BIR refused
to accept the filing of the Amended ITR. Was the BIR correct? Explain
27. Taal Savings and Loan Assoc (TSLA) is a thrift bank duly licensed by the BSP and is enjoying a tax incentive whereby for
a pd of 5 yrs starting from the commencement of its operations on 4/15/2012. It is exempted from all taxes except income
tax and local tax. TSLA bought computer units from Octagon for which the latter added 12%VAT in addition to the selling
price of the units. TSLA refused to pay the VAT and argued that it is liable to pay only under its charter income tax and
local tax. Was the refusal of TSLA tenable? Discuss
28. Batangas West High School (BSWH) is a non-profit, non-stock edu institution. During enrollment time, the school has big
amount of funds which are considered idle since there are no projects yet being initiated by the school for which funds are
needed. The treasurer of BWHS decided to invest the idle funds in the money market with BPI Capital Corp. withheld the
20% final withholding tax on the interest income pursuant to Section 24 of the Tax Code. BWHS questioned the
withholding of the tax on the interest income on the ground that as a non-profit, non-stock educational institution, it is
exempted under the Constitution from income tax. Decide.