Definition of 'Taxation' Taxation refers to the act of a taxing authority actually levying tax. Taxation as a term applies to all types of taxes, from income to gift to estate taxes. It is usually referred to as an act; any revenue collected is usually called "taxes. A means by which governments finance their expenditure by imposing charges on citizens and corporate entities . Governments use taxation to encourage or discourage certain economic decisions . For example, reduction in taxable personal (or household) income by the amount paid as interest on home mortgage loans results in greater construction activity , and generates more jobs . See also taxation principles . 1. The power of taxation is inherent in Sovereignty, it is essential or important to the existence ofevery government.- But why? Why do you think it is important? Any guess? 2. It is legislative in characters. But if the taxation is implemented by the constitution the power of taxation is legislative in character. It cannot be exercised by the executive or judicial branch of the government. -Which means only legislative branch of the government can impose the taxes. Yes the congress is the legislative branch of government can only tax, The power to tax is also granted by the constitution to local government subject to such guidelines and limitations as provided by law. 3. It is subject to constitutional and inherent limitations. The power of taxation is subject to certain limitations. Most of these limitations are specifically provided in the fundamental low or implied therefrom while the rest spring from of the taxing power itself. - As we know guys here in the Philippines we have taxes but those taxes are guided by the fundamental law. Which means it also have limitations or grounds.
NATURE OF THE POWER OF TAXATION 1. Legislative- this power can only be exercised by the law making body (Congress) not the executive or the judicial branch of the government, except when delegated by the national legislative body to a local legislative body or to the executive branch, subject to limitations as may be provided by law; 2. Inherent in sovereignty- the power exists as an incident or attribute of sovereignty, as it is essential to the existence of every government. The power can therefore be exercised even without the constitution or any law expressly conferring such power. Scope of the Power of Taxation It is comprehensive, unlimited, supreme and plenary, but subject to constitutional and inherent limitations.
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