CITY UNIVERSITY OF PASAY.doc

7/27/2019 CITY UNIVERSITY OF PASAY.doc

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1. Prospectivity of tax laws

CIR v. Acosta, GR154068, 3 August 2007

2. Double taxation

a. Strict senseb. Broad sensec. Constitutionality of double taxationd. Modes of eliminating double taxation

3. Escape from taxation

a. Shifting of tax burden

1) Ways of shifting the tax burden2) Taxes that can be shifted3) Meaning of impact and incidence of taxation

b. Tax avoidancec. Tax evasion

4. Exemption from taxation

a. Meaning of exemption from taxationb. Nature of tax exemptionc. Kinds of tax exemption

1) Express2) Implied3) Contractual

d. Rationale/grounds for exemptione. Revocation of tax exemption

5. Compensation and Set-off

6. Compromise

7. Tax amnesty

a. Definitionb. Distinguished from tax exemption

8. Construction and Interpretation of:

a. Tax laws

b. Tax exemption and exclusion

c. Tax rules and regulations

d. Penal provisions of tax laws

e. Non-retroactive application to taxpayers

H. Sources of tax laws

I. Scope and Limitation of Taxation

1. Inherent Limitations

a. Public Purpose

Pascual v. Secretary of Public Works, 110 Phil 331**Lutz v. Araneta, 98 Phil 148


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b. Inherently Legislative

Exceptions:

a) Delegation to local governments

b) Delegation to the Presidentc) Delegation to administrative agencies

Pepsi v. Municipality of Tanauan, 69 SCRA 460Pepsi v. City of Butuan, 24 SCRA 789

c. Territorial

d. International Comity

e. Exemption of Government Entities, Agencies, and Instrumentalities

LRTA v. CBAA, 12 October 2000MCIAA v. Marcos, 11 September 1996MIAA v. Paranaque, GR No. 155650, 20 July 2006MIAA v. Pasay City, G.R. No. 163072, 02 April 2009

2. Constitutional Limitations

a. Due process of law;

CREBA v. Exec. Sec. Romulo, March 9, 2010Villegas v. Hiu Chiong Tsai Pao Ho, 10 November 1978City of Baguio v. De Leon, 25 SCRA 938

b. Equal protection of laws;

Association of Customs Brokers v. Manila, 93 Phil 107Shell v. Vano, 94 Phil 387Kapatiran v. Tan, 30 June 1988Ormoc Sugar Central v. Ormoc Treasurer, 17 February 1968

Judy Anne Santos v. People, GR No. 173176, 26 August 2008

c. Uniformity and equity in taxation;

Tolentino v. Secretary of Finance, 25 August 1994

d. Prohibition against imprisonment for non-payment of poll tax;

e. Prohibition against impairment of obligations and contracts;

Cagayan Power and Light Co. v. CIR, GR No. 60126, September25, 1985MERALCO v. Province of Laguna, G.R. No. 131359, May 5, 1999RCPI v. Provincial Assessor of South Cotabato, GR No.144486,13 April 2005

f. Prohibition against infringement of religious freedom;

American Bible Society v. City of Manila, 101 Phil 386

g. Prohibition against appropriation of proceeds of taxation for the use,benefit, or support of any church

h. Prohibition against taxation of religious, charitable, and educationalentities

Lladoc v. CIR, 14 Phil 292Abra Valley College v. Aquino, 15 June 1988Herrera v. QC Board of Assessment Appeals, 30 September

1961


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Bishop of Nueva Segovia v. Provincial Board of Ilocos Norte, 51Phil 352Lung Center of the Philippines v. QC, 29 June 2004

i. Prohibition against taxation of non-stock, non-profit educationalinstitutions;

Department of Finance Order No. 137-87, dated Dec. 16, 1987CIR v. CA, 14 October 1998 (YMCA)

j. Others

a) Grant of tax exemptionb) Veto of appropriation, revenue, tariff bills bythe Presidentc) Non-impairment of the SC jurisdictiond) Revenue bills shall originate exclusively fromthe House of Rep.

ABAKADA Guro Party List, et al., v. The Honorable ExecutiveSecretary Eduardo Ermita, et al., G.R. No. 168056, 1September 2005

e) Infringement of press freedomf) Grant of franchise

J. Stages of Taxation

1. Levy2. Assessment and Collection3. Payment4. Refund

K. Essential Characteristics of Taxes

L. Requisites of a valid tax

M. Tax as distinguished from other forms of exactions

1. Tariff2. Toll3. License fee4. Special assessment5. Debt

N. Kinds of Taxes

1. As to object

a. Personal, capitation, or poll taxb. Property taxc. Privilege tax

2. As to burden or incidence

a. Directb. Indirect

3. As to tax rates

a. Specificb. Ad valoremc. Mixed

4. As to purposes

a. General or fiscal


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b. Special, regulatory, or sumptuary

5. As to scope or authority to impose

a. National internal revenue taxesb. Local real property tax, municipal tax

6. As to graduation

a. Progressiveb. Regressivec. Proportionate

II. INCOME TAXATION

A. The Concept of Income

Conwi v. CIR, 213 SCRA 83Madrigal v. Rafferty, 38 Phil 414

B. Tests Applied in Determining the Existence of Income

1. Severance Test/Realization Test2. Tax Benefit Rule and the Economic Benefit Test3. Claim of Right Doctrine4. Income from Whatever Source

C. Requisites for the Taxability of an Income

1. Existence of a Gain2. Realization of a Gain

a. Actualb. Constructive (e.g. Sec 26)c. Presumptive (e.g. Sec 24 d)

3. Gain must not be excluded (Section 32B)

D. The Philippine Income Tax System

1. Types of Income Tax Systems

a. Schedular System v. Global System

Sison v. Ancheta, GR No. L-59431, 25 July 1984

b. Schedular Rates of Taxes v. Schedular System

2. The Philippine Income Tax System as a Semi-Global/MixedSystem

E. Criteria in Imposing Philippine Income Taxes

1. Source2. Residency3. Citizenship

F. Tax Situs for Income Tax

Section 23Individual Taxpayers (Sections 24-26)Corporations (Sections 27 to 30)Estates and Trusts (Sections 60-66)Definition of Terms Under Section 22

Source of Income (Section 42)


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1. Services

CIR v. Marubeni Corp., GR No. 137377, 18 December 2001

2. Interest Income

NDC v. CIR, 151 SCRA 472

3. Dividends

4. Rent and Royalties

5. Sale of Property

a. Real Propertyb. Personal PropertyXpassage of title test

Tax treatment of properties produced within but sold without or producedwithout but sold within

d. Special Rules Re Software: RMC 44-2005

G. Gross income

1. Definition

Gross Income v. Gross Sales/ReceiptsThe General Rules on Inclusion and Exclusion of Income Items(Sections 31, 32A and 32B)

2. Compensation Income and Other Benefits

a. Taxability of Compensation Income and the Application of theEmployers Convenience Rule

Henderson v. Collector, 1 SCRA 649

b. Retirement Payments, Pensions and Gratuities

(a) RA 7641, RA 4917, Section 60B(b) Separation Payments(c) Leave Benefits(d) 13th Month Pay and other bonuses(e) SSS/GSIS Benefits/PhilHealth/Pag-ibig/Union Dues(f) Fringe Benefits (Section 33)

3. Rules applied to Trade/Business or Professional Income

4. Rules Applied to Passive Income

a. Royalties, prizes and winningsb. Interest Income from bank deposits and deposit substitutes

i. On Philippine Currencyii. On Foreign Currencyiii. Long-term investments

c. Dividends

CIR v. CA and ANSCOR, G.R. No. 108576, January 20, 1999Section 73B

d. Sale of Real Property classified as capital asset

i. Sale of principal residenceii. Alternative taxation in case of sale to government


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e. Sale of shares of stocks not listed or traded in the stock exchange

F. Rules as Applied to Other Sources of Income

a. Cancellation of Indebtedness

b. Income from Lease and Leasehold Improvementsc. Income from Installment Transactions

Banas v. CA, G.R. No. 102967. February 10, 2000

d. Income from Long-Term Construction Projects

H. Exclusions from Gross IncomeDefinitionExempt Corporations

a. GOCCsb. Non-stock non-profit educational institutions

I. Deductions from Gross Income

1. The Concept of Allowable Deductions

CIR v. Central Luzon Drug Corp., GR No. 159647, 15 April 2005CIR v. Central Luzon Drug Corp., GR No. 148512, 26 June 2006 andBicolandia Drug Corp. v. CIR, GR No. 142299, 22 June 2006 (See also:CIR v. Central Luzon Drug Corp., GR No. 159610, June 2008, in relationto RA9257)

2. Kinds of Allowable Deductions3. The Optional Standard Deduction (RA9504)4. Itemized Deductions: Concepts, Kinds, Rules and Requisites

a. General Business Expenses

CIR v. Isabela Cultural Corporation, 2007CIR v. General Foods, Inc., G.R. No. 143672. April 24, 2003CM Hoskins v. CIR, GR No. L-24059, 28 November 1969Gancayco v. Collector, 1 SCRA 980Representation Expenses, Rev. Regs. 10-2002

b. Bad Debts

i. Tax Benefit Rule

c. Interests

i. Requisites for Deductibilityii. Tax Arbitrage Scheme

Rev. Regs. 13-2000

iii. On Capital Expenditureiv. Interest on tax delinquencies

CIR v. Itogon Suyoc Mines, GR No. L-25399, 29 July 1969

d. Taxes

i. Requisites for Deductibilityii. Deductible Taxesiii. Non-deductible taxes

e. Depreciation

i. Properties subject to depreciation


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ii. Allowable modes of depreciation

f. Depletion

g. Losses

i. Ordinary Lossesii. Capital Lossesiii. Other Kinds of Lossesiv. NOLCO

Rev. Regs. 14-2001PICOP v. CIR, GR No. L-106949, 1 December 1995

v. Casualty Losses

h. Charitable Contributions

i. With Limitationii. Deductible in Full

i. Pension Trustsj. Research and Development Costs

J. Special Treatment of Gains and Losses from dealings in property

Ordinary Assets v. Capital Assets

China Banking Corporation v. Court of Appeals, G.R. No. 125508. July 19, 2000

Rules on Ordinary Gains and LossesSpecial Rules on Capital Transactions (Capital Gains and Losses)

a. Rules on Real Property classified as capital assetb. Rules on gains/losses from sale of shares of stocks not listed or

traded in the stock exchange by non-dealers in securitiesc. Rules regarding other capital assets

i. Loss Limitation Ruleii. Holding Period Ruleiii. Net Capital Loss Carry-Over (NCLCO) Rule

Wash Sales, Wagering Losses and Abandonment Losses

K. Taxation of Income of Individual taxpayers

1. Citizens

a) Resident citizensb) Non-resident citizens

2) Aliens

a) Resident aliensb) Non-resident aliens

i. Engaged in trade or businessii. Not engaged in trade or business

Personal Exemptions (Please see RA 9504)Additional ExemptionsChange of Status

Taxation of Married IndividualsMinimum Wage Earner

L. Taxation of Income of Corporate Taxpayers


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1. Definition of a Corporation2. Tests in Determining the Existence of a Corporate Taxpayer

(Applied to Partnerships, Co-ownerships and Estates)

Ona v. CIR, 45 SCRA 74Pascual and Dragon v. CIR, 166 SCRA 560

Obillos v. CIR, 139 SCRA 436Afisco Insurance Corp. v. CIR, 1999Evangelista v. CIR, 102 Phil 140

3. Kinds of Corporations4. Rules Applicable to Returnable Income5. Rules Applicable to Passive Income

a. Tax Sparing Rule

CIR v. Proctor and Gamble, 204 SCRA 378

6. Taxes Peculiar to Corporations

a. Minimum Corporate Income Taxb. Optional Corporate Income Taxc. Improperly Accumulated Earnings Tax

Cyanamid Phils. v. CA, G.R. No. 108067, January 20, 2000

7. Special Corporations8. Exempt Organizations and Corporations9.Corporations enjoying preferential tax rates

i. Domesticii. Foreign

10. Branch Profit Remittance Tax

11. Gross Philippine Billings

British Overseas Airways Corp. v. CIR, 149 SCRA 395 vis-a-visSection 23 A (3) (b) and Rev. Regs. 15-2002

12. Tax Returns and Other Administrative RequirementsPaseo Realty and Development Corp. v. CA, G.R. No. 119286, October 13,2004

M. Income Taxation of Estates and Trusts

N. Income Taxation of Partnerships

1. Business Partnership2. General Professional Partnership

III. TRANSFER TAXATION

A. Estate Taxes

1. Nature of estate tax

2. Reasons/doctrines supporting the imposition of estate tax

a. Benefits-received principleb. Ability to pay principlec. State partnership principle

3. The Gross Estate [What comprise the gross estate? (Section 85, NIRC)]


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4. Kinds of decedent for estate tax purposes

5. Inclusions in the gross estate

i. Decedents Interestii. Transfers in contemplation of death

iii. Revocable transfersiv. Property passing under a general power of appointmentv. Proceeds of life insurancevi. Prior interestvii. Transfers for insufficient consideration

6. Exclusions in the gross estate

i. The merger of usufruct in the owner of the naked titleii. The transmission or delivery of the inheritance or legacy by the fiduciaryheir or legatee to the fideicommissaryiii. The transmission from the first heir, legatee or donee in favor ofanother beneficiary, in accordance with the desire of the predecessor

iv. Transfers to social welfare, cultural and charitable institutions

7. The Net Estate and the Deductions from the Gross Estate (Section 86)

a. Expenses, Losses, Indebtedness, Taxes

i. Funeral Expenses

ii. Judicial Expenses

CIR v. CA and Pajonar, GR No. 123206, 22 March 2000

iii. Claims against the estate

iv. Claims against insolvent persons

v. Unpaid mortgage indebtedness

1. Accommodated loans

b. Vanishing deductions

c. Transfers for public use

d. Family Home

e. Standard deduction

f. Medical expenses

g. Amount received by heirs under Republic Act No. 4917

h. Tax treatment of share in conjugal or community property

i. Tax credits

8. Valuation

9. Administrative provisions

a. Filing of notice of death

b. Filing of estate tax return

c. Payment of tax


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10. Provisions safeguarding the interest of the government in the

collection of estate tax (Sections 94-97)

Marcos II v. CA, G.R. No. 120880, June 5, 1997

CIR v. Pineda, G.R. No. L-22734, September 15, 1967Lorenzo v. Posadas, G.R. No. 43082, June 18, 1937

B. Gift (Donors) Taxation

1. Nature of gift tax [Concept of gifts subject to gift taxes (Section 98)]

a. Direct gifts

b. Indirect gifts

i. Condonation of indebtednessii. Transfers for insufficient consideration

iii.Waiversiv.Renunciation of Inheritance

2. Factors that affect liability for gift taxes

a. Relationship of the donor and the donee (Section 99)

3. Deductions/Exemptions from the gift tax (Section 101)

4. Tax treatment of properties transferred for less than full or adequate

consideration (Section100)

a. In general

b. Real properties classified as capital asset

5. Tax treatment of political contributions

Abello, et al. v. CIR, GR No. 120721, 23 February 2005Rev. Regs 8-2009 (re Creditable Withholding Tax)

6. Valuation

7. Administrative provisions

a. Filing of notice of donation

b. Filing of donors tax return

c. Payment of tax

C. VALUE ADDED TAXATION

1. Nature of Value Added Tax

Kapatiran v. Tan, G.R. No. L-81311, June 30, 1988Tolentino v. Secretary of Finance, G.R. No. 115455, August 25, 1994

(Original Decision) and G.R. No. 115455, October 30, 1995 (Motion forReconsideration)ABAKADA Guro Party List v. Ermita G.R. No. 168056, 1 September 2005

2. VAT as an indirect tax

Distinctions between direct and indirect taxesSpecific characteristics of an indirect tax


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i. Imposed on the seller/lessor/importer/service provider

CIR v. Magsaysay Lines, GR No. 146984, 28 July 2006Philippine Acetylene v. CIR, 17 August 1967CIR v. American Rubber, 29 November 1966

CIR v. John Gotamco and Sons, 27 February 1987

3. Specific characteristics of Value Added Tax

a. Consumption based tax

i. Destination Principle

ii. Cross-border Doctrine

b. Tax Credit Mechanism

i. Input Tax

ii. Output VAT

4. Transactions subject to VAT

5. Rates of VAT

a. Ordinary

b. Exempt Transactions

c. Zero-Rated Transactions

d. Effectively Zero-Rated Transactions

Contex v. CIR, G.R. No. 151135, July 2, 2004CIR v. Seagate Technology (Phils.), GR No. 153866, 11 February2005CIR v. Acesite Hotel Corporation, 16 February 2007

6. Transactions Deemed Sale

CIR v. Magsaysay Lines, GR No. 146984, 28 July 2006

7. Transitional Input Tax

Fort Bonifacio Development Corporation v. Commissioner of InternalRevenue, GR Nos. 158885 & 170680, dated April 2, 2009

8. Presumptive Input Tax

9. Compliance Requirements

IV. INTERNAL REVENUE TAX ADMINISTRATION

ENFORCEMENT & REMEDIES

A. Tax Administration: In General

B. Government agencies involved in tax administration

C. Extent of Congress Power re Tax Administration

ABAKADA Guro Party List v. Purisima, GR166715, 14 August 2008British American Tobacco v. Camacho, GR163583, 20 August 2008


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D. The Bureau of Internal Revenue

a. Composition and Functions (Section 3, NIRC)

b. Powers and Duties

i. In General (Section 2)

ii. Specific

1. Interpret tax laws and decide cases (Sec 4)

a. BIR Issuances and the rules relevant thereto

Section 246, NIRCCIR v. Burroughs, 19 June 1986CIR v. CA and Fortune, 29 August 1996PB Com v. CIR, 28 January 1999

b. Cases that may be decided by the CIR

CIR v. Leal, 18 November 2002

2. Examination of books of accounts, etc. (Sec 5)

a. Requirement of issuance of a letter of authority

b. Third-party verification rule

c. Inquiry into bank deposits (Sec 6 F)

d. Summon persons, take testimony

3. Power to assess and prescribe requirements for tax

administration

a. Power to examine returns (Sec 6A)

i. Amendment of returns

ii. Rule on confidentiality of tax returns and the

exceptions thereto (Sections 71 and 270)

BIR v. Ombudsman, 11 April 2002

b. Power to make a return (Sec 6B)

i. Best evidence obtainable rule

CIR v. Hantex Trading, GR No. 136975, 31 March2005CIR v. Embroidery and Garment Industries, GRNo. 96262, 22 March1999

c. Power to conduct inventory taking, surveillance, and

to issue presumptive gross sales/receipts (Sec 6C)

d. Termination of tax period (Sec 6D)

e. Fixing of real property values (Sec 6E)

f. Accredit tax agents (Sec 6G)


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g. Power to prescribe procedural/documentary

requirements

i. E.g. E-Filing, Substituted Filingii. Net Worth Method

h. Power to delegate (Sec 7)

i. Non-delegable powers in relation to Section16

Republic v. Hizon, 13 December 1999

i. Enforcement of police powers (Sec 15)

j. Authority to Abate and Compromise Tax Liabilities

(Sec 6F (2), 204 in relation to Rev. Regs. 30-2002 asamended by RR No. 8-2004);

PNOC v. Court of Appeals, G.R. No.109976, April 26,

2005

People v. Tan, GR No. 152532, 16 August 2005

E. The rule on estoppel in relation to tax administration

a. Against the government

b. Against the taxpayer

F. Assessments and its governing principles

a. What constitutes an assessment

CIR v. Enron Subic Power Corporation, GR No. 166387, 19 January 2009CIR v. Pascor Realty, 29 June 1999CIR v. Reyes, G.R. No. 159694, January 27, 2006

b. Kinds of Assessment

c. Statute of Limitation on Assessment of Internal Revenue Taxes (Sections

203, 222, NIRC)

RMO 20-90, Philippine Journalists Inc., v. CIR, GR No. 162852, 16 December

2004

CIR v. CA and Carnation, GR No. 115712, 25 February 1999, 303 SCRA 614

c. Instances where the running of the prescriptive period is suspended

(Section 223)

Republic v. Hizon, 13 December 1999BPI v. CIR, GR No. 139736, 17 October 2005BPI v. CIR, G.R. No. 174942, 7 March 2008

d. Procedure in the process of assessment (Section 228)

e. Instances when pre-assessment is not required (Section 228)

f. Governing principles concerning assessment

g. When do we reckon the period when assessment was made?

h. Is assessment necessary before a taxpayer could be prosecuted for

violation of the NIRC?


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Ungab v. Cusi, May 30, 1980CIR v. CA, GR No. 119322, 4 June 1996CIR v. Pascor Realty, 29 June 1999

i. Are the procedures outlined in Section 228 of the NIRC retroactive?

CIR v. Reyes, G.R. No. 159694, January 27, 2006

G. Applicability of the Doctrine of Exhaustion of Administrative Remedies

H. Remedies available to taxpayers

a. Before Payment

1. Protest (Section 228, NIRC)

a. Requirements of a valid protestRev. Regs. 12-85

b. Effect of a protest on the period to collect deficiency taxes

CIR v. Wyeth Suaco Laboratories, GR No. 76281, 30 September 1991CIR v. Atlas Consolidated Mining, GR Nos. 31230-32, 14 February 2000

c. Failure of the BIR to act within the 180-day period

Lascona v. CIR, CTA Case 5777, 4 January 2000 vis--vis Section 7 (2),

RA 9282 and the Revised Rules of Procedure of the CTA, AM No. 05-11-

07-CTA

d. Administrative actions taken during the 180-day period

Compare: CIR v. Union Shipping, GR No. 66160, 21 May 1990, 185

SCRA 548 and CIR v. Isabela Cultural Corporation, GR No. 135210, 11

July 2001

e. Effect of a protest filed out of time

Protectors Services v. CA, GR No. 118176, 12 April 2000

f. Remedies from a denial of the protest

i. Motion for Reconsideration (BIR AppellateDivision)

ii. Appeal to the Court of Tax Appeals (RA 1125, as amended by

RA9282)

2. Compromise

b. After Payment

1. Refund (Section 229, NIRC)

a. Must be strictly construed against the taxpayer

Citibank, NA v. Court of Appeals, GR No. 107434, 10 October 1997

FEBTC v. CIR, GR No. 138919, 02 May 2006

b. Grounds for filing a claim for refund (See Section 229)

See also: Engtek Phils v. CIR, CTA Case No. 6644, 26 January 2005

c. Period within which to file a claim for refund


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i. General rule is two years from the date of payment

ACCRA Investments Corporation v. Court of Appeals, GR No.96322, 20 December 1991

Exception: CIR vs. Primetown Property Group, GR No. 162155,

28 August 2007.

ii. In case of amended returns

iii. In case of taxpayers contemplating dissolution

BPI v. CIR, 28 August 2001; See also: Sections 52(c) and 56(a)

d. Who has the personality to file a claim for refund?

CIR v. Procter and Gamble, GR No. 66838, 216 December 1991CIR v. CA, 20 January 1999Silkair v. CIR, GR Nos. 171383 & 172379, 14 November 2008

e. Is setting-off of taxes against a pending claim for refund allowed?The

doctrine of equitable recoupment--

Case: Philex Mining Corp. v. CIR, GR No. 125704, 28

August 1998

f. Is automatic application of excess tax credits allowed?

(Sec. 76)Please see Calamba Steel v. CIR, GR No.

151857, 28 April 2005; Systra Philippines v. CIR, GR

No. 176290, 21 September 2007; CIR v. BPI, GR No.

178490, 07 July 2009 (Irrevocability Rule)***

g. Effect of existing tax liability on a pending claim for

refundCase: CIR v. CA and Citytrust, GR No.

106611, 21 July 1994

h. Period of validity of a tax refund/credit (Sec. 230,

NIRC)

i. Returns are not actionable documents for

purposes of the rules on civil procedure and

evidence (See: Aguilar v. CIR, CA Case dated 30

March 1990)

i. Refund and Protest are mutually exclusive remedies

Case: Vda. De San Agustin v. CIR, 10 September 2001

j. Is the taxpayer entitled to claim interest on the

refunded tax? (Sec. 79 (c) 2, NIRC)


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c. Other Remedies

1. Action to Contest Forfeiture of Chattel (Sec. 231)

2. Redemption of Property Sold (Sec. 214)

C. Remedies available to the government

a. No injunction to restrain collection of taxes (Sec. 218, NIRC)

b. Period within which the government could collect (Sections 203, 222, NIRC)

Case: Republic v. Hizon, GR No. 130430, 13 December 1999; CIR v. Javier Jr., GR

No. 78953, 31 July 1991 (199 SCRA 825); PNOC v. CA, GR No. 109976, 26

April 2005; BPI v. CIR, GR No. 174942, 7 March 2008

c. Overview of Remedies (Section 205)

1. Tax Lien (Section 219, NIRC)

a. CIR v. NLRC, GR No. 74965, 9 November 1994

2. Compromise

3. Distraint and/or Levy

4. Civil Action

5. Criminal Action

6. Forfeiture

7. Suspension of business operations

8. Enforcement of administrative fines

d. Administrative Remedies in Detail (Sections 206-217, NIRC)

1. Distraint

a. Actual

b. Constructive

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2. Levy

3. Garnishment

e. Judicial Remedies in Detail (Section 220, NIRC)

1. Period within which the action may be filed

a. Civil Cases (Sections 203, 222, NIRC)

b. Criminal Cases (See: Title X, NIRC; Section 281,

NIRC)


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2. Where should these cases be filed?

a. Criminal Cases (See the imposable penalty vis--vis

the jurisdiction of courts)

b. Civil Cases (Consider the amount of tax sought to be

collected vis--vis the jurisdiction of courts, together

with the provisions of RA9282)

3. Cases:

a. Republic v. Hizon, GR No. 130430, 13 December

1999 (re approval of filing of civil and criminal action)

b. CIR v. La Suerte Cigar, G.R. No. 144942, 4 July 2002

(Re participation of the Office of the Solicitor General)

c. PNOC v. Court of Appeals, G.R. No. 109976, April 26,

2005*

d. Lim v. CA, GR Nos. 48134-37, 18 October 1990, 190

SCRA 616 (re prescription of criminal actions, Section 281,

NIRC)

e. Marcos II v. CA, GR No. 120880, 5 June 1997 (re

enforcement of tax liability during pendency of probate

proceedings)

f. Judy Anne Santos v. People, GR No. 173176, 26 August

2008

f. Effects of failure to pay the tax on time: Additions to the tax (Chapter I, Title X,

NIRC)

1. Surcharges

a. Ordinary (Section 248A, NIRC)

i. Failure to pay tax on time as required by the

tax code or the regulations

ii. Failure to pay the deficiency tax within the

time fixed in the notice

iii. Filing of the return with the wrong office

b. Fraud Penalty (Section 248B, NIRC)


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i. CIR v. Javier Jr., GR No. 78953, 31 July 1991

(199 SCRA 825)

c. Cases:

i. Imposition of Surcharge is mandatory

2. Interest (Section 249, NIRC)

a. In General

b. Deficiency Interest

c. Delinquency Interest

d. On Extended Payments

3. Compromise Penalties

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4. Effect of failure to file information returns (Section 250,

NIRC)

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CITY UNIVERSITY OF PASAY.doc