Exam (elaborations) Income Taxation

Income Taxation|Q1
TEST BANK
TRUE OR FALSE
1. When there is ambiguity of tax laws, the rules of statutory may not be used to search for the
legislative intent. However, when the meaning of the law is clear, the statute must be enforced
as written.
 FALSE
2. The doctrine of equitable recoupment is applicable to cases where the taxes involved and totally
related
 TRUE
3. The Philippine tax laws are (not) political and penal in nature
 FALSE
4. As a rule, doubts as to imposition must be solved liberally in favor of the government strictly
against the taxpayers
 TRUE
5. Tax laws must be construed strictly against the government, and tax exemptions must be not
construed strictly against the taxpayers.
 FALSE
6. No person shall be imprisoned for payment of income tax.
 TRUE
7. In taxation, it is one's civil liability to pay taxes which gives rise to non-criminal liability.
 FALSE
8. Tax laws are given retroactive effect because the rule of "ex post facto law" is not applicable for
tax purposes.
 TRUE
9. Interpretations made by executive branch for the enforcement tax laws are generally respected
by the Courts because they are not conclusive.
 TRUE
10. The power of Judicial Review in taxation is unlimited only to the interpretation and application
of tax laws.
 FALSE
11. Tax rulings of the Secretary of Finance are binding to the Courts because the Department of
Finance is the highest agency regarding tax administration.
 FALSE
12. The tax doctrine of Marshall Dictum explains that the tax is a power to destroy.
 TRUE
13. BIR Rulings are the best opinions regarding the interpretations of tax laws and are not
considered sound law until changed by the Court.

,  FALSE
14. Revenue regulations that are consistent with law have the effect and force of law if they are
useful and reasonable.
 TRUE
15. Tax exemption is non-transferable and assignable.
 TRUE
16. Whenever there is a violation of due process of law, the taxpayer may file a motion of
cancellation to the BIR and (or) Court to stop the tax assessment.
 FALSE
17. The interest on the deficiency tax shall continue to accrue upon the protest of the taxpayer
against the tax assessment.
 TRUE
18. Internal revenue taxes are self-assessing; hence government tax assessment is necessary to
demand settlement of a taxpayer's tax liability.
 TRUE
19. The power to interpret the provisions of the tax code, to be able to decide on tax cases under its
office is not granted by law to the BIR commissioner.
 TRUE
20. Under Title 1 Sec. 3 of NIRC, the BIR shall be headed by the Commissioner to be assisted by 2 (4)
deputy commissioner.
 FALSE
21. In general, payers are constituted withholding agents with regard to their income payments to
other taxpayers.
 TRUE
22. The Secretary of Justice has the authority to interpret and ascertain the validity of tax laws.
subject to the review by the Courts of Appeal.
 FALSE
23. The BIR is the not principally responsible for the fiscal policies and general management of the
government's financial resources.
 TRUE
24. The BIR is primarily in charge to collect taxes only imposed both by the national and local
government units.
 TRUE
25. The heart of tax administration is the enforcement of tax policy.
 TRUE
26. A valid assessment cannot be used as a basis for a tax compromise.
 FALSE
27. When a taxpayer applies for tax compromise, the CIR cannot automatically inquire into his bank
deposits.
 TRUE
28. Jeopardy assessment cannot be enforced when the taxpayer obstruct the proceedings to
collect taxes.