General Principles of Taxation (Nos. 1 - 40) 1.The process or means by which the sovereign, through its law-making body raises income to defray the expenses of the government A. TollB. License feeC. TaxationD. Assessment 2.The principal purpose of taxation is A. To encourage the growth of home industries through the proper use of tax exemptions and tax incentives B. To implement the police power of the state C. To reduce excessive inequalities of wealth D. To raise revenues for governmental needs 3.Taxation as distinguished from police power and power of eminent domain A. Property is taken to promote the general welfare B. Maybe exercised only by the government C. Operates upon the whole citizenry D. There is generally no limit as to the amount that may be imposed 4.This is an inherent limitation on the power of taxation A. Rule on uniformity and equity in taxation B. Due process of law and equal protection of the laws C. Non-impairment of the jurisdiction of the Supreme Court in tax cases D. Tax must be for public purpose 5.This is a constitutional limitation on the power of taxation A. Tax laws must be applied within the territorial jurisdiction of the state B. Exemption of government agencies and instrumentalities from taxation C. No appropriation of public money for religious purposes D. Power to tax cannot be delegated to private persons or entities 6.The tax imposed should be proportionate to the taxpayer's ability to pay A. Fiscal adequacyC. Administrative feasibility B. Equality or theoretical justiceD. Economic consistency 7.Which of the following statements is correct? A. The President is authorized to increase or decrease national internal revenue tax ratesThe congress has the vested power.VETO B. One of the nature of taxation is the reciprocal duties of protection and support between the state and subjects thereof C. Every sovereign government has the inherent power to tax D. Income tax is an indirect tax 8.Persons or things belonging to the same class shall be taxed at the same rate A. Simplicity in taxationC. Equality in taxation B. Reciprocity in taxationD. Uniformity in taxation 9.The tax should be proportional to the relative value of the property to be taxed A. Simplicity in taxationC. Equality in taxation B. Reciprocity in taxationD. Uniformity in taxation 10.The following are the nature of taxation, except: A. Inherent in sovereigntyC. Subject to inherent and constitutional limitations B. Essentially legislative in characterD. Subject to approval by the people 11.An escape from taxation where the producer or manufacturer pays the tax and endeavors to recoup himself by improving his process of production thereby turning out his units of products at a lower cost A. ShiftingB. ExemptionC. TransformationD. Capitalization 12.An escape from taxation where there is a reduction in the price of the taxed object equal to the capitalized value of future taxes which the taxpayer expects to be called upon to pay A. ShiftingB. ExemptionC. TransformationD. Capitalization 13.In every case of doubt, tax statutes are construed A. Strictly against the government and the taxpayer B. Liberally in favor of the government and the taxpayer C. Strictly against the government and liberally in favor of the taxpayer
D. Liberally in favor of the government and strictly against the taxpayer
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