1. If the method of deduction is itemized, the senior
citizen (SC) discounts granted by the seller of qualified
goods and services shall be treated as:
a. An addition to cost of sales/service.
b. An ordinary and necessary expenses
deductible from the gross income of the
seller
c.
Deduction from sales
d. SC discounts are not required to be reported
2. Private establishments employing SCs shall be entitled
to additional deduction from their gross income
equivalent to ______________________
a. 5% of the total amount paid as salaries and
wages to Senior citizens
b. 10% of the total amount paid as salaries and
wages to Senior citizens
c. 15% of the total amount paid as salaries and
wages to Senior citizens
d. 20% of the total amount paid as salaries and
wages to Senior citizens
e. 25% of the total amount paid as salaries and
wages to Senior citizens
3. For taxpayers with PWD dependent, the amount of
additional exemption which may be claimed is:
a. Php 0
b. Php 25,000.00
c.
Php 50,000.00
d. Php 100,000.00
4. Private corporations which are employing PWDs either
as regular employee, apprentice or learner, shall be
entitled to an additional deduction, from their gross
income, equivalent to:
a. Ten percent (10%) of the total amount paid as
salaries and wages to PWDs
b. Fifteen percent (15%) of the total amount paid
as salaries and wages to PWDs
c.
Twenty percent (20%) of the total amount paid
as salaries and wages to PWDs
d. Twenty-five percent (25%) of the total
amount paid as salaries and wages to PWDs
5. Who can register as a BMBE?
a. Glenn & Maggie’s Walking Alive, a shop with a
total assets (excluding land) of Php 5Million
b. Negan & Co., CPAs, a general professional
partnership
c.
d.
Nicanor who is a Certified Public Accountant
Rick and Daryl Beauty Shop, a partnership of
professional beauticians
6. 1st statement – Income tax exemption of BMBE shall
apply to passive income e.g. prizes and other winnings,
royalties and dividends.
2nd statement – Income tax exemption of BMBE shall
apply to capital gains from the sale of shares of stock not
traded through the stock exchange and capital gains from
the sale or other disposition of real property
a. Only the 1st statement is true
b. Only the 2nd statement is true
c.
Both of the statements are true
d. Both of the statements are false
7. Pedro contracted Juan to mortgage his land for
P3,272,000. His land has a zonal value of P5,000,000 and
an assessor’s fair value of P4,500,000.
a. P13,120
b. P12,000
c.
14,500
d. P15,000
(P3,272,000 - P5,000) ÷ P5,000 = 653.4 ≈ 654;
654 x P20 = P13,080 + P40 = P13,120
8. Kulas loaned Tomas P1,000,000 evidenced by a 12%
interestbearing note due in one-year time. Compute the
documentary stamp tax.
a. P0
b. P5,000
c. P7,500
d. 8,400
(P1,000,000 ÷ P200) x P1.50 = P7,500
9. The proceeds of the annual tax collected above accrue
to:
a. The Local Treasury
b.
The National Treasury
c.
The Sanggunian
d. The Special Education Fund (SEF)
10. The professional tax referred to in the preceding
number shall in no case exceed:
a. One hundred pesos (P100.00)
b. Three hundred pesos (P300.00)
c.
Five hundred pesos (P500.00)
d. One thousand pesos (P1,000.00)
11. 1st statement - ECOZONES or Special Economic
Zones (SEZ) are selected areas with highly developed or
which have the potential to be developed into
agri-industrial,
industrial,
tourist,
recreational,
commercial, banking, investment and financial centers
whose metes and bounds are fixed or delimited by
Presidential Proclamations. An ECOZONE may contain any
or all of the following: industrial estates (IEs), export
processing zones (EPZ), free trade zones and tourist /
recreational centers.
2nd statement - ECOZONE Export Enterprise refers to an
individual, association, partnership, corporation or other
form of business organization which has been registered
with the PEZA to engaged in manufacturing, assembling
or processing activity falling within the purview the Act
and resulting in the exportation of 100% of its production,
unless a lower percentage of its production for
exportation is prescribed by the Board subject to such
terms and conditions as the latter may determine.
a. Only the 1st statement is true
b. Only the 2nd statement is true
c. Both of the statements are true
d. Both of the statements are false
12. Customs Territory is the national territory of the
Philippines outside of the proclaimed boundaries of the
ECOZONES except those areas specifically declared by
other laws and/or presidential proclamations to have the
status of special economic zones and / or free ports.
a. True
b. False
13. 1st statement - ECOZONE Pioneer Enterprise may be
an ECOZONE enterprise which uses a design, formula,
scheme, method, process or system or production of
transformation of any element, substance or raw
materials into another raw material or finished goods
which is new and untried in the Philippines.
2nd statement - ECOZONE Developer/Operator is a
business entity or concern duly registered with and / or
licensed by the PEZA to develop, operate and maintain an
ECOZONE or any or all of the component IE, EPZ, Free
Trade Zone or Tourist / Recreational Center and the
required infrastructure facilities and utilities such as light
and power system, water supply and distribution system,
sewerage and drainage system, pollution control devices,
communication
facilities,
paved
road
network,
administration building and other facilities as may be
required by the PEZA.
a. Only the 1st statement is true
b. Only the 2nd statement is true
c.
d.
Both of the statements are true
Both of the statements are false
14. ECOZONE Service Enterprise is a business entity or
concern within the ECOZONE whose income derived
within the ECOZONE shall be subject to taxes under the
National Internal Revenue Code.
a. True
b. False
15. Registration Agreement is the final agreement
executed by the PEZA and the ECOZONE Enterprise
setting forth the terms and conditions for the latter's
operation of business or engaged of economic activity
within the ECOZONE.
a. True
b. False
16. Start of Commercial Operations is the date specified
in the Registration Agreement or the date when the
particular ECOZONE export enterprise actually begins
production of the registered product for commercial
purposes, whichever comes first, irrespective of phases or
modules or schedule of development.
a. True
b. False
17. For purposes of computing the tax, gross Income
means the gross sales or gross revenues derived from
business activity within the ECOZONE, net of sales
discounts, sales return and allowances and minus costs of
sales or direct costs but before any deduction is made for
administrative expenses or incidental losses during a
given taxable period.
a. True
b. False
18. The Philippine Economic Zone Authority (PEZA) Board
is an attached agency of:
a. Department of Finance (DOF)
b. Department of Trade and Industry (DTI)
c.
National Economic and Development Authority
(NEDA)
d. Securities and Exchange Commission (SEC)
19. The PEZA Board is headed by a _____________with the
rank of department undersecretary who shall be
appointed by the President.
a. Administrator
b.
c.
d.
Director general
Manager
Presiding Officer
20. The % share of the national government in 5% gross
income taxation of PEZA locators is:
a. 2%
b. 3%
c.
40%
d. 60%
21. The % share of the city or municipality in 5% gross
income taxation of PEZA locators is:
a. 2%
b. 3%
c.
40%
d. 60% Income
Tax Holiday (ITH) for New ECOZONE Export or Free Trade
Enterprises:
22. For New Registered Pioneer Firms:
a. Three (3) years from commercial operations
b. Four (4) years from commercial operations
c.
Five (5) years from commercial operations
d. Six (6) years from commercial operations
23. For New Registered Non-Pioneer Firms:
a. Three (3) years from commercial operations
b. Four (4) years from commercial operations
c.
Five (5) years from commercial operations
d. Six (6) years from commercial operations
24. For Expanding Firms:
a. Three (3) years from commercial operation
of the expansion
b. Four (4) years from commercial operation of the
expansion
c.
Five (5) years from commercial operation of the
expansion
d. Six (6) years from commercial operation of the
expansion
25. For purposes of computing the tax due, identify which
of the following is an allowable deduction of a PEZA
export enterprise?
a. Depreciation
b. Raw materials used in the manufacture of
products
c.
Rent and utility charges
d.
Salary, wages or labor expenses
26. ABC PTE Ltd. is an eco-zone developer/operator and
facility enterprise. It is subject to 5% gross income
taxation. Which of the following is NOT an allowable
deduction in computing its tax?
a. Direct salaries, wages or labor expenses
b. Financing charges associated with fixed assets
c.
Rent and utility charges for buildings and capital
equipment
d. Salaries of product supervisor
27. The Board of Investments (BOI) was created under:
a. EO 216
b. EO 226
c.
EO 266
d. EO 286
28. The BOI is an attached agency of:
a. Department of Finance (DOF)
b. Department of Trade and Industry (DTI)
c.
National Economic and Development Authority
(NEDA)
d. Securities and Exchange Commission (SEC)
29. The following are non-fiscal incentives of a BOI
registered enterprise, except:
a. Foreign nationals may be employed in
supervisory, technical or advisory positions
within five (5) years from a project’s registration
b. Income tax holiday for a number of years
depending on whether the status of the
registrant is a pioneer or non-pioneer
c.
Registered export-oriented enterprise shall
have access to the utilization of the bonded
warehousing system in all areas.
d. Simplification of customs procedures for the
importation of equipment, spare parts, raw
materials, and supplies and exports of
processed products of registered enterprises in
the operations of their bonded warehouses.
e. There shall be no restrictions on the use of
consigned equipment provided a re-export
bond is posted.
30. The following are the purposes of the Conversion
Authority, except:
a. To serve as the holding company of subsidiary
companies created pursuant to Section 16 of
b.
c.
d.
this Act and to invest in Special Economic Zones
declared under Sections 12 and 15 of this Act
To manage and operate through government
agencies developmental projects outside the
jurisdiction of subsidiary companies and
special Economic Zones declared by
presidential proclamations and established
under this Act
To establish a mechanism in coordination with
the appropriate local government units to effect
meaningful consultation regarding the plans,
programs and projects within the regions where
such
plans,
programs
and/or
project
development are part of the conversion of the
Clark and Subic military reservations and their
extensions and the surrounding communities as
envisioned in this Act
To plan, program and undertake the
adjustment, relocation, or resettlement of
population within the Clark and Subic military
reservations and their extensions as may be
deemed necessary and beneficial by the
Conversion Authority, in coordination with the
appropriate government agencies and local
government units.
31. The following are the powers of the Conversion
Authority
a. To give donations, grants, bequests and
assistance of all kinds to local and foreign
government and private sectors
b. To invest its funds and other assets other than
those of the Special Economic Zones under
Sections 12 and 15 of this Act in such areas it
may deem wise
c.
To exercise the right of eminent domain
d. To exercise oversight functions over the Special
Economic Zones declared under this Act and by
subsequent presidential proclamations within
the framework of the declared policies of the
Act
32. The powers and functions of the Conversion Authority
shall be exercised by a Board of Directors to be
composed of ______ members.
a. 6
b. 7
c.
8
d. 9
33. The Board of Directors of the Conversion Authority
shall perform the following functions, except
a. Prepare the annual and supplemental budgets
of the Conversion Authority
b. Submit an annual report of the operation of the
Conversion Authority to the President of the
Philippines, President of the Senate and
Speaker of the House of Representatives
c.
Determine the organizational structure of the
Conversion Authority, define the duties and
responsibilities of all officials and employees
and adopt a compensation and benefit scheme
at least equivalent to that of the Central bank of
the Philippines
d. Appoint all officials down to the third level
and authorize the president of the
Conversion Authority to appoint all others;
Provided, That all appointments shall be on
the basis of merit and fitness and all
personnel action shall be in pursuance of the
civil code, rules and regulations, except
those coterminus employees of the
members of the Board
34. The piece of legislation that amended Bases
Conversion and Development Act of 1992.
a. R.A. 7227
b. R.A. 8553
c.
R.A. 8748
d. R.A. 9400
35. The government agency that monitors and reviews
the incentives granted by the Conversion Authority and
submit an annual report to the President.
a. Department of Trade and Industry
b. Bureau of Internal Revenue
c.
National Economic Development Authority
d. Department of Finance
36. Tax treaty relief application (TTRA) shall be filed with:
a. Audit Information and Tax Exemption Division
(AITED)
b. International Tax Affairs Division (ITAD)
c.
Office of the Commissioner of Internal Revenue
d. Office of the Deputy Commissioner – Legal and
Inspection Group
37. Filing of tax treaty relief application (TTRA) should be
made:
a. Before transaction (before the occurrence of
the taxable event)
b. Within ten (10) days after the transaction
c.
Within thirty (30) days after the transaction
d. Within one (1) month after the transaction
e. Within six (6) months after the transaction
38. The following are No-Ruling Areas as far as the TTRA
are concerned, except:
a. Based on hypothetical transactions
b. Future transactions
c. Past transactions
d. Request
for
rulings
without
complete
documents
39. The purpose of Double Taxation Agreements include
the following, except:
a. Statutory tax rates can be effectively reduced by
the agreement
b. Avoid double taxation
c.
Relieve taxpayer of having to bear the burden of
taxation two-fold (paying twice on same income)
d. Divide the right of taxation between the
contracting countries, to avoid differences, to
ensure taxpayers' equal rights and security, and
to prevent evasion of taxation
e. All of the foregoing are purposes of DTA
40. What is a tax treaty?
a. Is a convention or agreement for the
avoidance of double taxation and the
prevention of fiscal evasion with respect to
taxes on income (and on capital).
b. Is intended to promote international trade and
investment in several ways, the most important
of which is by allocating taxing jurisdiction
between the Contracting States so as to
eliminate or mitigate double taxation of income.
c.
Is intended to permit the Contracting States to
better enforce their domestic laws so as to
reduce tax evasion.
d. Is an international agreement between two or
more states (contracting states) for efficient
enforcement and beneficial implementation of
tax laws.
41. What is the purpose of tax treaty?
I. Is convention or agreement for the avoidance of double
taxation and the prevention of fiscal evasion with respect
to taxes on income (and on capital).
II. Is intended to promote international trade and
investment in several ways, the most important of which
is by allocating taxing jurisdiction between the
Contracting States so as to eliminate or mitigate double
taxation of income.
III. Is intended to permit the Contracting States to better
enforce their domestic laws so as to reduce tax evasion.
IV. Is international agreement between two or more
states (contracting states) for efficient enforcement and
beneficial implementation of tax laws.
a. I and II
b. II and III
c.
III and IV
d. All of the above
42. A Domestic Corporation pays royalty to a Foreign
Corporation but it withholds a tax lower than Philippine
tax laws based on a treaty. What document need be
presented to prove the imposition of a lower withholding
tax?
a. Treaty law
b. Memorandum of agreement between the local
and international company
c.
Reciprocity clause
d. Tax treaty relief application.
43. What taxes are covered by Philippine Tax Treaties?
I. Income tax
II. Business tax
III. Transfer tax
IV. Documentary stamp tax
a. Only I
b. Both I and II
c.
I, II and III
d. All of the above
44. The rental income of a non-resident foreign
corporation from lease of aircraft is subject to 7.5% final
withholding tax under the Tax Code, but rentals and
royalties are generally subject to the 15% final
withholding tax under the tax treaties. For Philippine
income tax purposes, what rate shall be used?
a. 15%
b. 7.5%
c.
Either a or b at the option of the government
d. Either a or b at the option of the taxpayer
45. Diplomatic and consular representatives are
exempted from the community tax certificate. The
exemption adheres to the principle of:
a. Situs of taxation
b. International comity
c. Tax exemption of dignitaries
d. Immunity of government from taxes
46. The Ambassador of the United States of America
decided to go on vacation in the Shangrila Hotel in
Boracay, he stayed there for a week enjoying the
beautiful waters and beaches of Boracay. On his
departure from the hotel, he was presented with a bill for
his stay, to which he noticed that he was being imposed
the VAT of 12% as, part of the bill. He refused to pay the
same because he is entitled to tax exemptions in the
Philippines, being an ambassador assigned to the
Philippines. The hotel argued that since he is there on his
personal capacity, the privileges granted to him were just
like any ordinary person. The ambassador is:
a. Correct in insisting on his privileges because of
the principles of international comity in taxation
b. Correct in insisting on his privileges because he
represents the most powerful nation in the
world
c.
Incorrect because he was acting as a private
citizen during the period
d. Incorrect because as a temporary resident in
the Philippines, he is required to contribute
to the Philippine coffers, regardless of his
length of stay in the Philippines.
47. A treaty containing tax exemptions must be ratified by
a. 2/3 majority of the Senate
b. Majority of all members of Congress
c.
Both
d. None of the above
48. No law granting any tax exemption shall be passed
without the concurrence of
a. Majority of all member of the Congress
b. 3/4 vote of all members of the Congress
c.
2/3 vote of all member of the Congress
d. Unanimous vote of all members of the congress
49. In order to avail the benefits of taxes paid abroad,
what must be presented to the regulatory body?
a. Memorandum of agreement between the tax
b.
c.
d.
payer and host country.
Tax treaty law of the host country
Tax treaty relief application
Other relevant documents as may be required
by regulatory body.
50. In case of conflict between the provisions of a tax
treaty and domestic law, the provision of the tax treaty
generally prevails.
a. True
b. False
-END-