TAXATION QUESTION 1996
Our present income tax system can be said to have the following basic features:
(a) It has adopted a COMPREHENSIVE TAX SITUS by using the nationality, residence, and source rules. This makes citizens and resident aliens taxable on their income derived from all sources while non-resident aliens are taxed only on their income derived from within the Philippines. Domestic corporations are also taxed on universal income while foreign corporations are taxed only on income from within.
(b) The individual income tax system is mainly PROGRESSIVE IN NATURE in that it provides a graduated rates of income tax. Corporations in general are taxed at a flat rate of thirty five percent (35%) of net income.
(c) It has retained MORE SCHEDULAR THAN GLOBAL FEATURES with respect to individual taxpayers but has maintained a more global treatment on corporations.
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