Imus Institute
Quiz No. 1 Income taxation
1. It is an enforced contribution levied by the state by virtue of the sovereignty on persons and
property within its jurisdiction for the support of the government and all public needs.
2. (Phil. CPA) The proportional contribution by persons and property levied by the lawmaking
body of the state by virtue of its sovereignty for the support of the government and all public
needs is referred to as?
3. The amount required as dictated by the needs of the government is?
4. One of the characteristics of tax is that it is generally:
a. Based on contract c. Assignable
b. Payable in money d. Optional
5. Which is not an essential characteristic of tax?
a. Unlimited as to amount c. Proportionate in characteristic
b. Payable in money d. Regular payment
6. All of the following, except one, is an essential characteristic of a tax. Which is the
exception?
a. It is based on the ability to pay c. It is generally payable in money
b. It is an enforced contribution d. It is proportionate in character
Answer: B
7. One of the characteristic or an element of tax.
a. It is levied by the legislature c. It is proportionate in character
b. It is payable in money or in kind d. It is an enforced contribution
Answer: D
8. One of the characteristics of tax is that:
a. It is generally based on contract c. It is generally assignable
b. It is generally payable in money d. Answer not given
9. One of the following is not a national tax.
a. Income tax c. Documentary stamp tax
b. Value-added tax d. Community tax
10. Tax on business is:
a. A direct tax c. A property tax
b. An indirect tax d. A poll tax
11. Which of the following is not a direct tax?
a. Immigration tax c. Income tax
b. Transfer tax d. Value-added tax
Imus Institute
Quiz No. 1 Income taxation
12. Which of the following is not an example of a direct tax?
a. Income tax c. Community tax
b. Transfer tax d. Business tax
13. The basic community tax of P5.00 of an individual is:
a. A property tax c. A national tax
b. A direct tax d. An ad valorem tax
14. Differentiate ad-valorem tax and Specific Tax.
15. Tax of fixed proportion to the value of the property with respect to which the tax is assessed
and requires the intervention of assessors or appraisers to estimate the value of such property
before the amount due from each taxpayer can be determined is known as?
16. One of the following is not a general or tax.
a. Income tax c. Custom duty
b. Donor’s tax d. None of the choices
17. Which of the following is not an example of excise tax?
a. Transfer tax c. Real property tax
b. Value-added tax d. Income tax
18. As to rate, value-added is an example of what kind of tax?
19. A kind of tax system when rate increases as the tax base increases.
20. The following are kinds of taxes as to gradation. Which one is not?
a. Digressive
b. Regressive
c. Uniform
d. Progressive
21. Statement 1: The value-added tax is a property tax.
Statement 2: The estate tax is a direct tax.
a. The two statements are correct
b. The two statements are wrong
c. Statement 1 is correct while statement 2 is wrong
d. Statement 1 is wrong while statement 2 is correct
22. This is a demand of ownership
23. It is collected for the use of somebody else’s property.
24. Toll is distinguished from tax.
a. Demand of sovereignty
b. Imposed by government only
c. Amount is based on the cost of construction of public improvement used
Imus Institute
Quiz No. 1 Income taxation
d. Paid for the support of the Government
26. Special assessment distinguished from tax.
25. An a.
enforced
Leviedproportional
on persons, property
contribution
or the
from
exercise
ownersof privilege
of lands for special benefits resulting
fromb.public
Personal
improvements.
liability of the person taxed
c. Has general application
d. Exceptional both as to time and place
27. Which statement is wrong?
a. A tax is a demand of sovereignty.
b. A toll is a demand of ownership.
c. A special assessment is a tax.
d. Customs duty is a tax.
28. Which of the following terms describes the statement, “that the state has complete discretion
on the amount to be imposed, after distinguishing between a useful and non-useful activity?’
a. Tax c. Toll
b. License fee d. Customs duty
29. Which of the following distinguishes tax from license fee?
a. Non-payment does not necessarily render the business illegal
b. A regulatory measure
c. Imposed in the exercise of police power
d. Limited cover cost of regulation
30. The distinction of permit or license from tax is that license fee is:
a. Imposed for revenue
b. One which involves an exercise of police power
c. One in which there is generally no limit on the amount that may be imposed
d. Imposed through the provisions of the Constitution
31. The distinction of a tax from permit or license is that a tax is:
a. Imposed for regulation
b. One which involves an exercise of police power
c. One in which there is generally no limit on the amount that may be imposed
d. Imposed through the provisions of the Constitution
32. Which of the following is generally based on contract?
a. Tax c. Debt
b. Toll d. Penalty
33. Debt as distinguished from tax.
a. Based on law
b. May be paid in kind
c. Does not draw interest except when delinquent
d. Generally not subject to set-off or compensation
34. Which of the following is designed to regulate conduct?
a. Tax b. Toll
Imus Institute
Quiz No. 1 Income taxation
c. Penalty d. Special assessment
35. There can be a classification of the subject matter being required to shoulder the burden.
Which is the exception?
a. Tax c. Toll
b. License fee d. Eminent domain
36. A pecuniary aid directly granted by the government to an individual or private commercial
enterprise deemed beneficial to the public.
37. Which of the following refers to the term tariff?
a. A book of rates drawn usually in alphabetical order containing the names several
kinds of merchandise with the corresponding duties to be paid for the same
b. The duties payable on goods imported and exported
c. The system or principle of imposing duties on the importation and exportation of
goods
d. All of the choices
38. It comprises all kinds of funds including taxes.
39. In case of deductions and exemptions on income tax returns, doubts shall be resolved:
40. The following except one, are exceptions to the rule that tax exemptions must be strictly
construed.
a. Where the statute granting the exemption provides for the liberal interpretation
thereof
b. The taxpayer does not fall within the purview of exception by clear legislative intent
c. Case of special taxes relating to special cases and affecting only special classes of
persons
d. Exemptions refer to public property
41. In case of ambiguity, tax laws shall be interpreted:
a. Strictly against the taxpayer
b. Liberally against the government
c. Liberally in favor of the taxpayer
d. Liberally in the favor of the government
42. Which of the following is not a legal way of not paying tax?
a. Tax avoidance c. Tax exemption
b. Tax evasion d. None of the choices
43. Which of the following is not a scheme of shifting the incidence of taxation?
a. The manufacturer transfers the tax to the consumer by adding the tax to the selling
price of the goods sold
Imus Institute
Quiz No. 1 Income taxation
b. The purchaser asks for a discount or refuses to buy at regular prices unless it is
reduced by the amount equal to the tax he will pay
c. Changing the terms of the sale like FOB shipping point in the Philippines to FOB
destination abroad, so that the title passes abroad instead in the Philippines
d. The manufacturer transfers the sales tax to the distributor, then in turn to the
wholesaler, to the retailer and finally to the consumer
44. One of the characteristics of internal revenue tax is that they are:
a. Criminal in nature
b. Penal in nature
c. Political in nature
d. Generally prospective in application
45. In case on conflict between tax laws and generally accepted accounting principles (GAAP)
what shall prevail?
46. Christopher, a CPA, has just obtained her CPA license. Before he can lawfully pursue his
occupation, he should pay:
a. Privilege tax (PTR) c. Percentage tax
b. Income tax d. Value-added tax
47. The reduction in the selling price of income-producing property by an amount equal to the
capitalized value of future taxes that may be paid by the purchaser.
48. The method by which the manufacturer or producer upon whom the tax is imposed pays the
tax and strives to recover such expenses through lower production cost without sacrificing
the quality of the product.
49. The least source of our tax laws.
a. Statutes c. Constitution
b. Court decisions d. BIR rulings
