BA 127 COVERAGE

A. Taxes Page 15 – 19
a. Definition
b. Essential characteristics
c. As distinguished from other forms of exactions
i. Tariff
ii. License fee
 Philippine Airlines v. Edu and Carbonell, G.R. No. L-
41383, August 15, 1988
iii. Toll
iv. Special levy
v. Ordinary debt
 Philex Mining Corporation v. Commissioner of Internal
Revenue, G.R. No. 125704, August 28, 1998
d. Kinds of Taxes
i. As to object
1. Personal, capitation or poll tax (e.g., basic
community tax)
2. Property tax (e.g., realty tax)
3. Privilege/excise tax (e.g., internal revenue taxes,
customs duties)
ii. As to burden or incidence
1. Direct (e.g., income, estate, donor’s tax)
2. Indirect [e.g., excise tax, value-added tax (VAT)]
iii. As to determination of amount
1. Specific tax
2. Ad valorem
3. Mixed
iv. As to purposes
1. General or fiscal (e.g., income taxes)
2. Special, regulatory or sumptuary [e.g.,Special
Education Fund under the Local Government Code (LGC)
v. As to scope or authority to impose
1. National (e.g., internal revenue taxes)
2. Local (e.g., real property tax)
vi. As to graduation
1. Progressive (e.g., income tax)
2. Regressive
3. Proportionate (e.g., real estate tax under the LGC)
General Principles of a Sound Tax System PAGE 5- 7
A. Fiscal adequacy
B. Administrative feasibility
C. Theoretical justice or equality

Scope and Limitations of Taxation

1. Inherent limitations
a. Public purpose
b. Inherently legislative

General rule: Delegata potestas non potest delegari. (Power to tax may not be
delegated.)
Exceptions
c. Delegation to local government units (LGUs)
 Sec. 5, Art. X, 1987 Constitution (Const.)
 [See: Book II of Republic Act (RA) No. 7160 or
the “Local Government Code of 1991”, as
amended]
d. Delegation to the President
 Sec. 28(2), Art. VI, Const.
 [See: Sec. 401, Presidential Decree No. 1464 or
the “Tariff and Customs Code of 1978”, as
amended]
e. Delegation to administrative agencies – PAGE 7