Econ 20 Chapter 8-10

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Chapters 8, 9 and 10

Economics 20.1Economics DepartmentXavier University- Ateneo de Cagayan

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Chapter 8: TaxationCharacteristics

1. Enforced

2. Payable by money

3. Proportionate

4. Levied in person/property

5. Levied by state (w/c has

jurisdiction)

6. Specifically by law-makingbody

7. For public purpose

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Chapter 8: TaxationNature

1. Inherent in sovereigntyessential

for all governments.2. Legislativecongress can impose

taxes.

3. Subject to constitution and laws

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Chapter 8: TaxationPrinciple of Sound tax

1. Fiscal Adequacy: Supply of Funds

and Demand2. Equality/Justice: Rawlsian way-

proportionate burden towards

ability to pay.

3. Administrative Feasibility:

Effectively Administered.

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Chapter 8: TaxationClassifications

1. By subject:

a) Individual fixed taxPersonal pollcapitation e.g residence certificate.

b) Property tax e.g real estate tax.

c) excise tax -for doing something e.gbusiness tax; VAT

2. By purpose:

a) Revenue tax e.g. income tax

b) Special tax e.g. duties

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3. By scope:

a) National

b) Local

4. By Determination of amount:

a) Specificexcise tax on wines,

amusement tax.b) Ad valoremreal estates tax,

percentage tax.

Chapter 8: Taxation

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5. By payee:a) Direct

b) Indirect

6. By graduation rate:

a) Proportional

b) Progressive

c) Regressive

A tax is toll license fee debt penalty

.. But these can be tariffs or duties

Chapter 8: Taxation

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Chapter 8: TaxationKinds (according to the Law)

1) National -Tariff & Customs Code2) Local - LGC.

Kinds of NIRT :1) income tax 2) estate tax 3)

donor/gift tax 4) VAT

5) excise tax 6) doc. Stamptax..(ex. SPA)

7) duties; travel tax; energy tax ;

vehicle tax. 10/2/20119

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Chapter 8: TaxationIncome tax(Personal) - Privilege tax..

TaxableBased on gross

income:

(less deduction)exemptions: ( by NIRC)

-min. wage earns.

-1 worker of HH ( 50,000)-each dependent not

exceeding 4 ( 25,000)10/2/201110

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A dependent child is: legitimate, leg. Adopted < 21; cantsupport him/herself

A recognized child isoutside wedlock and recognized

So: Taxable income = GI - E

Steps:

After getting the taxable income,

Look at the table and follow the rule

Subtract any withholding tax if there

is.

Chapter 8: Taxation

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Chapter 9:Agrarian ReformLand reformRedistribution of rights of ownership

and/or the use of land away fromthe landowners and in favor of the

poor who cultivated it.

Examples: land tenants infamily farms, large estates to

small families, dividing equally

large lands to small settlements

IN OTHER WORDS, THOSE

WHO TILL MUST OWN THE

LAND10/2/201112

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Chapter 9:Agrarian ReformDefinitions

Reform: fixing a

malfunctioning conditionLand Reform: reforming

land property rights among

workers and owners due toagrarian structure defects.

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Chapter 9:Agrarian Reform

Definitions

Agrarian structure: is

composed of agricultural

structure and its

land tenure system-

regulation of rights

Production- operation

Services system- credit,

marketing and supply of

agricultural materials

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Chapter 9: Agrarian

ReformAgrarian Reform

Farmers should own the land

they cultivated to INCREASETHEIR QUALITY OF LIFE

AND TO EMPOWER THEM.

Comprehensive AgrarianReform Program (CARP)

A law passes in 1988 (RA 6657)

which entails agrarian reform.

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CARP law

Redistribute land fairly,

regardless of crops and fruitsproduced to farmers and

workers who are landless

irrespective of their tenuresystem.

Includes profit sharing, stock

sharing, access to credit,production methods, etc.

Exceptions: those for urbanization

and government programs andothers( i.e. churches)10/2/201116

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Chapter 9:Agrarian ReformOther provisions:

Retention limit: max of five

(5) hectares to be owned.Qualifications: aged 15 and

above and already worked for

the land as of 1988.Components:

Land distribution- own the

land they worked.Companion measures- be

successful owners.

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Chapter 9:Agrarian ReformCompanion measures

Access to credit

Improved facilities ofinfrastructure

Better production methods

Cooperatives

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Land reform

Land tenure problems arise because

of increasing population, destructionof land, urbanization, etc.

Important because:

It corrects semi-feudal landsystem of the Phils.

Upholds economic freedom

Improves farmingLiberates capital for new

industries (i.e. non farm

employment)

Uplifts poverty and democracy10/2/201119

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Chapter 9:Agrarian ReformGoals

Increase income and security

Develop skills among farmersObjectives

Operational: transfer titles,

improve capabilities,etc.Political: eradicate feudalism,

increase democracy

Economic: increasedevelopment, production

Social: remove inequalities10/2/20110

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Chapter 10:Consumer Education

RA 7394 (CONSUMER ACT OF 1992)

Mandates:

Develop and provide safety

and quality standard for

consumer products

(including the use and practice)

Assist the consumer inevaluation.

Protect the public versus

threats of using theproduct, if there is.

Do R&D to improve quality

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Chapter 10:Consumer EducationScope

All firms (foreign and

domestic)National Council for

Consumer Affairs (NCAC)

Oversees these mandates

Implementing agencies

DOH (drugs)

DA (agricultural products)

DepEd (consumer education)

LGU (unprocessed foods)

DTI (consumer products)10/2/20112

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Chapter 10:Consumer EducationDTI

Tasked against deceptive

and unfair sales orpractices

Deceptive, if a consumer is

manipulates in buying theproduct

Unfair, ifthe seller takes

advantage of the ignorance,mental infirmity, physical

incapability of the consumer.

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Applications:

If the complainant is a natural

personSubject is a consumer product

Nature of the complaint is either

about fairness and deception.Areas of concern:

Quality and safety

Deceptive/unfair practice

Warranties

Labeling, packaging, price tags

Advertising/promotiions

Repair/service shops 10/2/201124

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Chapter 10:Consumer EducationInvestigation is done

after filing for a petition.

For sellers:Within 2 years of consumer

transaction

For warranties need to:

Set the terms

Parties

Coverage and expiration

What to do in case of defects

What he can avail

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Chapter 10:Consumer EducationPenalties are given

Amicable settlements

Returning the product

Refunds

Restitution

. .depending on the nature ofcomplaint.

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Consumer rights

1. Basic needsguarantee

survival2. Safety- against hazardous

goods

3. Information- againstdishonest or misleading ads

and the right to information

needed to make aninformed choice on buying.

4. Choose- choosing

competitive products atgood quality and price10/2/201127

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Chapter 10:Consumer EducationConsumer rights

5. Redress- to be

compensated fromunsatisfactory service.

6. Representation- express

consumer interest ingovernment policies

7. Consumer education

8. Healthy environment

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Chapter 10:Consumer EducationConsumer Responsibilities

1. Critical awareness- alert in the

price and quantity of the goods

2. Action- ensure a fair deal

3. Social concernaware of the

impact of our consumption to our

citizens (esp. the powerless)4. Environmental awareness -

aware of the impact of our

consumption to our environment5. Solidarity- unite to promote

consumer protection and interest.

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Types of consumer

. Bargain addict

-Crazy with sales regardless of the

quality and presence of deceitful

traders. (e.g. buy 1 take 1)

. Wasteful consumer

-Doesnt save goods (light, water, food

becomes spoiled).

. Impulsive buyer

-Buys anything she likes and regrets

afterwards, tempted with ads

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4. Close-fisted (silas marner)

-Keeps money even if deprived (e.g.

saving for load when the stomachis empty)

5. Panic buyer

-Gullible with rumors and hoards.6. Spend-thrift

-Spends on anything luxurious

7. Intelligent buyer-Prioritizes her needs and limits

purchases with her ability to pay.

Documents

Econ 20 Chapter 8-10