1 What is the importance of VAT Exen Transactions with regard the nature c proportionate tax? Provide five (5) VAT exempt transacti
1 What is the importance of VAT Exen Transactions with regard the nature c proportionate tax? Provide five (5) VAT exempt transacti
Chapter1: Understanding And Working With The Federal Tax Law
Section: Chapter Questions
Problem 12DQ
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Question
ANSWER 1, 2 AND 3
![1 What is the importance of VAT Exempt
Transactions with regard the nature of VAT being a
proportionate tax?
Provide five (5) VAT exempt transactions under
Section 109 of the Tax Code, as amended, and its
impact in our society.
2 In transfers for insufficient consideration, what is
the reason why the excess of fair market value of
the transferred property at the time of death over
the value of the consideration received should be
included in the gross estate of the decedent?
3 If a transaction is one of the VAT-exempt
transactions enumerated from Section 109 (A) to
(BB) of the Tax Code (other than Section 109 [CC]
of the Tax Code which provides that sale of goods/
properties/services, the gross annual sales or
receipts do not exceed P3,000,000 is not subject to
VAT), the same is naturally not subject to VAT.
However, will the said VAT exempt transaction
(falling under Section 109 [A] to [BB]) should be
subject to Other Percentage Tax? Explain your
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Transcribed Image Text:1 What is the importance of VAT Exempt
Transactions with regard the nature of VAT being a
proportionate tax?
Provide five (5) VAT exempt transactions under
Section 109 of the Tax Code, as amended, and its
impact in our society.
2 In transfers for insufficient consideration, what is
the reason why the excess of fair market value of
the transferred property at the time of death over
the value of the consideration received should be
included in the gross estate of the decedent?
3 If a transaction is one of the VAT-exempt
transactions enumerated from Section 109 (A) to
(BB) of the Tax Code (other than Section 109 [CC]
of the Tax Code which provides that sale of goods/
properties/services, the gross annual sales or
receipts do not exceed P3,000,000 is not subject to
VAT), the same is naturally not subject to VAT.
However, will the said VAT exempt transaction
(falling under Section 109 [A] to [BB]) should be
subject to Other Percentage Tax? Explain your
answer.
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