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PRINCIPLES OF TAXATION: (General Principles and Income Taxation)
nd
College of Commerce and Business Administration [2 Semester, A.Y. 2012 – 2013]
Atty. Marcel M. Ortiguerra
PART IV. BUSINESS TAXES
VAT-REGISTERED PERSONS:
Business – regular conduct or pursuit of a
commercial or economic activity, including
transactions incidental thereto, by any person or
government entity.
a. There must be a commercial or economic
activity
b. There must be regularity in the activity
Commercial or economic activity – an activity, the
purpose of which is to obtain gain, profit or income
Any person who, in the course of trade or
business, sells, barters or exchanges goods
or properties or engages in the sale or
exchange of services shall be liable to
register if:
1. The gross sale or gross receipts for the past
12 months have exceeded P1,500,000.00,
excluding VAT-exempt transactions
2. There is reasonable grounds to believe that
his gross receipts or gross sales in the next
12 month period shall exceed P1,500,000.00,
excluding VAT-exempt transactions
MAJOR BUSINESS TAXES:
1. Excise taxes
2. Value-added taxes
3. Percentage taxes
A. VALUE-ADDED TAX (VAT)
A form of sales tax
Is in the nature of tax on consumption.
A tax on the estimated market value added
to a product or material at each stage of its
manufacture or distribution, ultimately
passed to the consumer.
an indirect tax and the amount of tax may
be shifted or passed on to the buyer,
transferee or lessee of the goods, properties
or services
Should a person required to register under
the VAT system fails to do so, he shall still be
liable for the payment of the tax but he
cannot avail of the input tax credit for the
period that he was not registered
INPUT AND OUTPUT TAXES
Input tax
The value-added tax due from or paid by a
VAT-registered person in the course of his
trade or business on importation of goods or
local purchase of goods or services,
including lease or...