Fitero B.
Garlitos
2017-E905019
Problem 2-5 Multiple choice
Encircle the letter that correspond your answer.
1. Which of the following is /are element/s of impact of taxation?
i. Levy
ii. Assessment
iii. Collection
Choices:
a. I, ii and iii
b. I and ii only
c. Ii and iii only
d. Iii only
2. It is one of the attributes of a sound taxation system which states that revenue must be sufficient to support
governmental expenditures.
a. Fiscal adequacy c. Administrative feasibility
b. Theoretical justice d. Equity
3. Which of the following statement is correct?
a. Levying and collection of taxes are legislative functions
b. Assessment and collection are administrative function
c. Enacting of tax laws and its interpretation are legislative functions.
d. Levying and impositions are judicial functions
4. Which of the following is correct?
a. Fixing of tax rates
b. Valuation of object of tax
c. Collection of taxes
d. Assessment of tax liability
5. Which of the following is not a measure to enhance administrative feasibility of taxation system?
a. Collection of taxes proportionate to ability of the tax payer to pay
b. Withholding of taxes at source
c. Quarterly filing and payment of income tax on business income
d. Accreditation of bank to collect taxes.
6. Basic principles of taxation which states that “ taxes must be based on the taxpayer’s ability to pay” is called
a. Equality in taxation c. Theoretical justice
b. Ability to pay theory d. Equity in taxation
7. It has executive supervision and control over tax administration.
a. Bureau of internal revenue
b. Bureau of customs
c. Department of finance
d. Court of justice
8. Which of the following is not among the administrative powers of the Bureau of Internal Revenue?
a. Compromise tax assessment
b. Distrait of personal property of delinquent taxpayer
Fitero B. Garlitos
2017-E905019
c. Levy of real property of delinquent taxpayer
d. Render court decision concerning tax dispute
9. Which of the following is not correct?
a. If it is the first employment of the taxpayer, he must be registered with the BIR before employment or
within 10 days from date of employment.
b. If the taxpayer is self-employed, he must registered his business within 10 days from commencement of
his business
c. If the tax payer is both employed and doing business, he must have only one TIN as employee and as sole
proprietor
d. TIN must be indicated in the return, documents or statement filed with the BIR.
10. Statement 1: self-employed and businesses are registered annually
Statement 2: the annual registration fee is P500 payable on or before the end of January of each year.
a. Only statement 1 is correct c. Only statement 2 is correct
b. Both statements are correct d. Both statements are not correct
11. Statement 1: an individual taxpayer earning purely compensation income is exempt from P500 reg. fee, but
required to renew his registration every year.
Statement 2: cooperatives are exempt from annual registration with the BIR.
a. Only statement 1 is correct c. Only statement 2 is correct
b. Both statements are correct d. Both statements are not correct
12. Statement 1: a businessman with more than P1,919,500 annual sale or receipts must be registered as VAT
business
Statement 2: a business with less than P1,919,500 annual or receipts may be registered as VAT business.
a. Only statement 1 is correct c. Only statement 2 is correct
b. Both statements are correct d. Both statements are not correct
13. Statement 1: Businesses registered with the BIR are required to issue commercial invoice for sales of goods
and receipts for services rendered.
Statement 2: A VAT sales invoice is not issued by a VAT- registered business for its sales to a non-VAT registered
buyer.
a. Only statement 1 is correct c. Only statement 2 is correct
b. Both statements are correct d. Both statements are not correct
Problem 2-6 Multiple choice
Encircle the letter that correspond your answer.
1. Which of the following is not correct?
a. A tax assessment could be done before the filing of tax return but after the expiration of prescribed period
for filing
b. A tax assessment could be done after the filing of tax return
c. When the business is closed, a tax assessment could be done even before the expiration of the prescribed
filing date.
d. The BIR commissioner and the Taxpayer may agree in writing on the assessment period after the expiration
of the prescribed period for assessment.
Fitero B. Garlitos
2017-E905019
2. Which of the following is not correct?
a. The taxpayer may protest the tax assessment by filing the BIR Commissioner a written request for
reinvestigation within 60 days from receipt such assessment.
b. If the tax assessment protest is not acted upon the BIR Commissioner within 180 days from submission of
documents, the taxpayer may appeal to the court of tax appeals.
c. The appeal to the court of tax appeals must be done within 30 days from receipt of the BIR commissioner’s
decision on the formal protest filed.
d. If the taxpayer did not make any appeal on the tax assessment, it becomes final, executor and demandable.
3. If the taxpayer failed to pay the tax demanded per final assessment, the government may exercise several
administrative remedies. Which of the following is not correct?
a. Levy or the real property of the tax payer may be availed of only after distrait of personal property of
taxpayer.
b. Either distrait or levy may be pursued simultaneously once the assessment becomes final and demandable
c. If the tax assessed is P100 and below, levy or distrait may not be availed of
d. The remedy of distrait of personal property may be repeated if necessary until the full amount due all
expenses are collected.
4. Which of the following is not true with regards to the authority of the Commissioner to enter into tax
compromise?
a. The tax payer must not have an existing tax liability
b. There must be an offer by the tax payer or commissioner of an amount to be paid by the taxpayer
c. A reasonable doubt as to validity of the claim against the taxpayer exists.
d. The financial position of the taxpayer demonstrates a clear inability to pay assessed tax.
5. Which of the following is the correct minimum compromise rate that the commissioner could legally accept?
a. 105 of the basic tax assessed due to financial incapability for a dissolved corporation
b. 205 of the basic tax assessed due to financial incapability for non-operating companies for a period of 3
days or more as of date application for compromise
c. 40% for doubtful validity of assessment
d. 40% for financial incapability of non- operating companies for a period of less than 3 years
6. Which of the following surcharge is not true?
a. 25% of basic amount of tax due for simple neglect
b. 25% of basic amount of tax due for unintentional failure to file and pay tax return on prescribed date.
c. 50% of basic amount of tax due for filing a return with an internal revenue officer other than those with
whom the return in required to be filed.
d. 50% of the basis amount to tax due for false or fraudulent tax return
7. An informant reward given for information provided resulting in revenue recoveries. Which of the following
amount of reward that could be legally awarded is correct?
a. P1,000,000 for each fraud case discovered
b. 10% of revenue recovered or P1,000,000/case, whichever is higher
c. 10% of fair market value of smuggled goods seized or P1,000,000/case, whichever is higher
d. 10% of revenue recovered but not to exceed P1,000,000/case
Fitero B. Garlitos
2017-E905019
8. The tax return is required to be filed on or before April 15, 2005. The actual tax return was filed March 12,
2005. The last day for assessment is
a. April 15, 2015 c. March 15, 2015
b. April 15, 2008 d. March 15, 2008
9. Statement 1; businesses are required to maintain only one set of books of account
Statement 2; a letter of authority is necessary before a BIR examiner could not allowed to inspect the books of
accounts of the taxpayer.
a. Only statement 1 is correct
b. Only statement 2 is correct
c. Both statements are correct
d. Both statements are not correct
10. The seized property of delinquent tax payer becomes the property of the government. This refers to.
a. Distrait
b. Levy
c. Forfeiture
d. Compromise
