1.

TAXATION DEFINED - It is an attribute of sovereignty and emanates from necessity - It refers to the inherent power
of the state to demand enforced contribution upon its subjects and objects within its territorial jurisdiction for public
purpose to support the government.
2. THEORY OF TAXATION
a. PRINCIPLE OF NECESSITY - the existence of the government is a necessity and it cannot continue without
means to support itslef.
b. BENEFIT-RECEIVED THEORY - the government and the people have the reciprocal and mutual duties of support
and protection to one another
c.LIFEBLOOD DOCTRINE - taxes are the lifeblood of the government without which it can neither exist nor endure.
Without money the government cannot deliver services to the people or fucntion and serve the people.
BASIS OF TAXATION
a. BENEFIT-RECEIVED THEORY (mutual and reciprocal duty of support and protection between the government
and the people.
b. The sovereign power of the State over its people and property
C. the presumption of receipts/enjoyment of benefts and protection by the people.
d. To protect new conditions by imposing special duties.
e. To uplift social conditions by imposing regulatory taxes/licenses.
3. PURPOSE OF TAXATION
a. Primary - to raise or generate revenues and to mobilize resources
b. Secondary or Regulatory (RAP) - to regulate the conduct of business or professions to achieve economic and
social stability to protect local industries
c. Compensatory (RKSPT)
-Reduces inequalities in wealth distribution
- Key instument of social control
- Strengthens anemic enterprises Provides incentives
- Check infation - Tools on international bargains
- Promote Science and Invention
- Use as implement in the exercise of police power to promote general welfare
4. NATURE AND EXTENT OF POWER TO TAX SCOPE OF POWER TO TAXATION - It is supreme, comprehensive ,
unlimited and plenary. It includes the power to destroy
OBJECT OF TAXATION
A. bUSINESSES
b. interests
c. Transactions
d. rights
e. acts
f. Persons (natural or juridical)
g. Properties( real or personalm, tangible or intangible)
h. privileges
5. ESSENTIAL CHARACTERICTICS OF TAX A.
a. It is for the public purpose
b. It is inherently legislative
c. It is subject to international comity or treaty
d. It is an exaction payable in money
e. It is territorial
f. It is not absolute because its exercise is subject to constitutional limitations and inherent restrictions
6. ELEMENTS OF A VALID TAX
A. it must violate the constitutional, inherent and and/r contractual limitations of the power of taxation.
b. It must be uiform and equitable , not unjust, excessive , oppresive , confscatory or discriminatory
c. It must be for public purpose
d. The power imposing it must have jurisdiction over the obje of taxation
e. It must be proportionate in character.
f. generally payable in money , at regular interval (not a regular payment);
g. Levied by the legislature that has jurisdiction over the object of taxation
7. Phases or Stages of Taxation IMPACT OFTAXATION
a. LEVY OR IMPOSITION - Generally, it cannot be delegated. This usually includes the
1. Selection of Coverage, Object, Nature, Extent, Suits (CONES) in taxation
2. its purpose
3. prescribing the rules in taxation in general
b. Asssessment or Collection - delegable by a valid statue INCIDENCE OF TAXATION
c. Payment of the Tax - the response of the people to the revenue bill duly encated by the lawmaking body
of the government in the exercise of its power of taxation
8. ELEMENTS OF A TAX SYSTEM
A. Tax Structure - Refers to the tax rates, tax base, tax subjects and other taxable events as they relate to
revenue productivity , tax progressivity , equity and and the political, social and economic goals of the
government.
b. Tax administration - It is the system involving assesment, collection and enforcement of taxes , including
the execution of judgement on all tax cases decided by the courts in favor of the government . It includes the
organizational structure , personnel, set up operational procedures and fnancing of the tax implementation
agency.
c. Public Tax consciousness - This is related to the level of voluntary and honest compliance of tax
obligations by the people.
9. PRINCIPLES OF SOUND TAX SYSTEM
a. fscal adequacy - The sources of revenue must be adequate to meet government expenditures and their
variation regardless of business conditions.
b. administrative Feasibility - Tax laws should be capable of convenient , just and efective iadministration.
they should be clear, concise and capable of proper and economic enforcement, convenient as to time and
manner of payment and not burdensome.
c. theoritical justice- Taxes levied must be based upon the ability of the taxpayer to pay, it must not be unduly
burdensome, confscatory or discouraging to business . It must be uniform and equitable.
10. to be photocopied.
11. CLASSFICATION OF TAXES.
A. AS TO PURPOSE
1. Fiscal (general or revenue) - they are levied wihtout a specifc or pre-determine purpose.
2. Regulatory (special or sumptuary) - those intended to achieve some social or economic goals
B. A TO SUBJECT MATTER
1. Personal (poll or capitation) - does not consider the amount of property , occupation of business of the
taxpayer.
2. property Tax
3. Excuse (privilege tax)
C. As to incidence ( Who pays the burden of taxation?)
1,. Direct Tax - It is imposed on the person obliged to pay the same and this burden cannot be shifted or
passed on to another (i.e. income tax)
2. Indirect Tax - The payment is demanded from the person who is allowed to transfer the burden of taxation
to another. ( i.e Value added tax) > if the end-user is tax exempt
(a) the exemption applies only to direct taxes and the buyer cannot claim tax refund on those taxes
that were passed to him.
(b) the seller cannot claim the exemption as well.
> The remedy of seller is enjoying both exemptions from direct and indirect taxes - Avail of the
remedy of tax refund from the government. An importer paid excise taxes on petroleum products which were
sold to NPC. The lattter enjoys both exemptions from direct and indirect taxes , and therefore, Sec. 135 of
the tax code comes to play and operates to grant the supplier tax exemption because it cannot shift the
burden of taxation to NPC ( end-user) , the impoter should be entitled to a tax credit certifcate In indirect
taxes, the person authorized to claim for the refund is the payor not the end consumer.
D. AS TO AMOUNT (EXCISE TAX)
1. Specifc Tax - This is a fxed amount based on volume, weights or quantity of goods as measured by tools,
instruments or standards. It requires no assessment as the subject of taxation is often listed according to
their general classifcation. (ex. tax on gasoline , LPG, petroleum, products, wires)
2. Ad valorem tax - This imposition is based on the value of the property subject tax. Assessment is
necessary to determine the amount payable. ( tax on automobile and properties) . excise tax , wheter
classifed as specifc or ad valorem tax is basically an indirect tax imposed on the consumption of a specifc
list of goods or products. The tax is directly levied on the manufacturere upon removal of the taxable goods
from the place of production but in reality , the tax is passed on the to the end-consumer as prt of the selling
price of the goods sold.
E. AS TO RATE
1. Proportaion or fat rate - unitary or single rate ex. 12% VAT.
2. Progressive or graudated tax - as the tax base grows the tax rate increases . (ex. Individual income tax ,
5% - 32 %
3. Regressive tax - the tax rate increases as the tax base decreases
4. Degressive tax- the increase in tax rate is not proportionate to the increase of tax base
5. mixed tax - at certain point it is progressive , then regressive
. F. AS TO AUTHORITY IMPOSING TAX
1. National Tax
2. Local Tax
14. SKIP
15. LIMITATIONS ON POWER TO TAX A. INHERENT LIMITATIONS
(1) PUBLIC PURPOSE
(2) INTERNATIONAL COMITY
(3) TERRITORIALITY
(4) NON-DELEGATION OF POWER TO TAX
(a) Exceptions
(b) powers tat cannot be delegated to Congress
(5) Exemption of Government agencies
B. CONSITUTIONAL LIMITATIONS
1. DUE PROCESS - requires previous notice and hearing or to the exercie of taxation within the territorial
jurisdicition of the taxing authority.
2.EQUAL PROTECTION OF LAW - All persons subject to legislation shall be treated alike under like
circumstances and conditions both in privileges conferred and liabilities imposed.
3. UNIFORMITY IN TAXATION - all taxable articles, kinds of properties of the same class , shall be taxed at
the same rate or all subjects/objects that are similarly situated are treated alike as to burden that may be
imposed and the benefts that may result.
4. PROGRESSIVE SYSTEM OF TAXATION - is based on the ability-to pay principle and it favors the
imposition of direct taxes rather than the indirect taxes.
5.NON-IMPRISONEMENT FOR NON PAYMENT OF POLL TAX
6. NON- IMPAIRMENT OF THE OBLIGATION AND CONTACT RULE
7. APPROPRIATION , REVENUE AND TARIFF BILLS MUST ORIGINATE EXCLUSIVELY IN THE HOUSE
OF REPERESENTATIVES but the Senate may propose or concur with amendments.
8. PRESIDENTIA VETO - the President shall have the power to veto any particular item(s) in an
appropriation, revenue or tarif , but the veto shall not afect the item(s) to which no objection has been
made. - THE President's derivative power to ta is provided under the Constitution (Art.6 , sec. 28(2)) and Sec
401 of the Tarif and Customs code is the ebaling law that made efective the delegation of the taxing power
to him.
9. PRESIDENTIAL POWER TO FIX TARIFF RATES
10. FREEDOM OF THE PRESS
11. FREEDOM OF RELIGION - religious entities selling or distributing religus literature is subject to VAT-
registration fee imposed oon Non-vat enterprises - No violation of the free worship clause because it is not
imposed for the exercise of the privilege but only for the purpose of defraying part of the cost of registration
12. EXEMPTION FORM PROPERTY TAX OF PROPERTIES OF RELIGIOUS , EDUCATIONAL AND
CHARITABLE INSTITUTIONS
13. TAX EXEMPTION GRANTED TO A NON-STOCK , NON PROFIT EDUCATNAL AND CHARITABLE
INSTITUTION INCLUDING GRANTS, ENDOWMENTS
14. NO PUBLIC MONEY SHALL BE USED FOR A PARTICULAR SECT , PRIET , RELIGIOUS MINISTERS
15. GRANT OF TAX EXEMPTIONS
16. GRANT OF POWER TO TAX TO LOCAL GOVERENT UNITS
17. MONEY COLLECTED FOR A SPECIAL PURPOSE SHALL BE CONSIDERED A SPECIAL FUND ;
18. EXCLUSIVE APPELLATE JURISDICTION OF THE SUPREME COURT OVER JUDGEMENTS OF
LOWER COURTS INVOLVING THE LEGALITY OF TAXES, IMPOSTS, ASSESSMENTS, FEES AND
PENALTY
. 16. DOCTRINES/PRINCIPLES IN TAXATION
A. dOCTRINE OF SOVEREIGN EQUALITY - The international rule maintains that property or income of a
foreign state or government may not be the subject of taxation by another State. If a tax law violates some
international treaty, laws or convention , it is not only invalid but unconstitutional because the Constitution
provides that: Philippine adopts the generally accepted principles of international laws as part of the law of
the land.
B. DOCTRINE OF THE MOST FAVORED NATION CLAUSE - This concept is intended to establish the
proinciple of equality of international treatment by providing that the citizens of subjects of the contracting
nations may enjoy privileges accoreded by either party to those of the mostfavored nation. This will aloow
the taxpayer of one state to avail of more liberal provisions granted in another tax treaty to which the country
of residence of such taxpayer is also a party provided that the subject matter of taxation is the same as that
in the tax treaty under which the taxpayer is liable.
C. DOCTRINE OF PRIMARY JURISDICTION - it precludes a court from arrogating unto itself the authority
to resolve a controversy the jurisdiction over which is initially lodged with an administrative body of special
competence. - when the determination requires expertise , specialized skills and knowledge of the proper
administrative bdies because thecnical matter or intricate questions of fact are involved , the relief must frst
be obtained in an administrative proceeding before a remedy will be supplied by the Court even though the
matter is wihtin the jurisdiction of the court.
D. DOCTRINE OF JUDICIAL NON- INTERFERENCE - The courts cannot inquire into the wisdom of the
taxing act or the advisability or expediecy of the tax measure. The impracticability and absured
consequences of a tax law should be address to the legislature and administrative authorities and NOT the
Court
. E. THE MARSaLL DICTUM - The power to tax includes the power to destroy because the taxpayer has no
choice except to pay the tax being imposed if he is covered by the imposition. - it has no application to a lwful
tax. This is pertinent only when there is no power to tax a particular subject and it has no relaion to such a
case where such dright exist, because the power to destroy may be a consequence of taxation , but it can
not tax to the point of confscation.
F. HOLMES DOCTRINE -tHE power to tax is not the power to destroy. In the exercise of the taxing power the
authority should not violate the constitutional , inherent and contractual limitations otherwise the court has
the primordial duty to decalre the smae void and unconstituional , thereby preventing the destructive nature
of power of the taxation.
G. PRINCIPLES OF APPROVAL OF AN ADMINISTRATIVE INTERPRETATION THRU REENACTMENT
H. THE PROSPETIVITY RULE - the tax laws are prospective in character and in application exceptions : a.
The retroative application is necesarily implied form the language used. b. It involves income tax c. the
retroactive application is intended by the Congress. > when the tax law imposes a criminal liabilty it annot be
given a retroactive efect because that would violate the ex post facto law , but if it imposes civil penalties like
fnes and forfeiture , it can be given a retroactive efect unles it produces harsh consquences , its validity
may be questioned on grounds of equity and due process.
J. THE IMPRESCRIPTIBILITY OF THE TAX LAWS - taxes are imprescriptible unless the law itself lprovides
for prescription.
H. NATIONAL TAXES ARE NOT SUBJECT TO LEGAL COMPENASATION
a. lifeblood doctrine
b. the government and the taxpayer are not creditor and debtor to each other.
c. taxes are not in the nature of contracts between the parties but grew out of duty. case law: The city of
manila is entitled to 25% share in the franchise tax payable by Manila Jockey club on its gross earnings from
horse races. City of Manila was not paid because the National Treasury failed to release the same. Thus, the
city of manila refuse to remit taxes it witheld to compensate for its 25% share . HELD. NO legal basis
because
a.) taxes are not subject to set-of
b) the Lifeblood doctrine
EXCEPTIONS:
A) the legal compensation by operation of law , when both claims the local government and the taxpayer
against each other have already become due, demandable, and fully liquidated.
b.) In case of overpayment of a tax, the BIR's obligation to refund or set-of arises from the moment the tax
was paid under the principle of solutio indebti
. I. PRINCIPLE OF STRICTISSIMI JURIS -Taxation is the rule and the exemtion is the exception. Tax
exemptions must be strictly construed against the tax payer and liberally in favor of the government.
EXCEPTIONS: when is tax exemption construed in favor of the taxpayer?
1. exemptions in favor of the government
2. Exemptions in favor of the traditional exemptees
3. when the law itself provides
4. Retirement laws
5. exemptions in favor of special classes of taxpayers under special circumstamces
J. DOCTRINE OF ESTOPPEL - in the performance of its governmental functions , the State cannot be
estopped by the neglect , errors, or mistakes of its agents or ofcers. Thus, the erronous application and
enforcement of law by public ofcials do not block the subsequent correct application of the statutes. ( this
doctrine works against the taxpayer)
K. DOCTRINE OF EQUITABLE RECOUPMENT -When the refund of taxes are barred by presciption which
can no longer be claimed by a taxpayer but there is a present tax being based assessed against the saod
taxpayer , such present tax may be recoup or set-of against the tax , the refund of which has been barred. r
L. TAXPAYER'S SUIT -It is a class suit brought by one or more taxpayers (natural or juridical) on behalf of
themselves and as a representation of a class of taxpayers situated withina taxing district and for the
purpose of seeking from the illegal or unauthorized acts of the government or its tax ofcials which acts are
injurious to their common interest as taxpayers
17. SOURCES OF TAX LAWS
a. Constitution
b. Statutes and Presidential Decrees
c. Executive Orders and Batas Pambansa d. Local Ordinances
e. Revenue regulations promulgated by the Department of Finance
f. Administrative Issuances or BIR rulings
g. Judicial Decisions
h. Tax treaties and conventions with foreign countries
18. SITUS OR SUBJECT OF TAXATION - SituS means the place of taxation or the authority that can collect
the tax because it gave the subject or object of taxation protection; the state which has jurisdiction to impose
a particular tax upon persons, property interest , rights or transactions because it has extend benefts to the
subject or object of taxation.
WHAT DETERMINES THE SITUS OF TAXATION IN THE PHILIPPINES? - income may be taxed in one or
more or all of the following places or countries
a. the place where the taxpayer is a citizen
b. the place where the taxpayer is resident
c. the place where the income was earned or derived.
Thus, if a German national residing in the US receives dividend from a Philippine domestic corporation , said
dividend may be taxed in Germany where he is a citizen , or in the US , where he is a resident , or in the
Philippines where the income was earned or derived.
A. FACTORS THAT DETERMINE THE SITUS OF TAXATION
A. subject matter of the tax
b. Nature, kind or classifcation of the tax being imposed.
c. citizenship of the taxpayer
d. residence of the taxpayer
e. source of income
f. Place of exercise, business or occupation being taxed.
g. Place where activity that produced the income was hel or done.
19. DOUBLE TAXATION
A- taxing the object/subject within the territorial jurisdiction twice, by the same taxing authority for the same
period , purpose and involving the same kind of tax.
B. TWO KINDS OF DOUBLE TAXATION
1. DIRECT DUPLICATE TAXATION this is objectionable and prohibited because it violates the constitutional
provisions on uniformity and equality . It happens the same subject/object of taxation is taxed twice when it
should only be taxed once.
2. INDIRECT DUPLICATE TAXATION no constitutional violation . Such as taxing the same property by 2
diferent taxing authorities.
Note: Double taxation is not a valid defense against the legality of a tax measure.
C. INTERNATIONAL JURIDICAL DOUBLE TAXATION
- Only resident citizen and Domestic Corporation may be held liable to international double taxation . The
concerned taxpayer is entitled to claim TAX CREDIT on foreign income taxes paid to minimize the impact in
international double taxation. If taxed only once , the beneft of tax credit is not available.
D. METHODS USED IN VTAX TREATIES TO AVOID DOUBLE TAXATION
1. EXEMPTION METHOD the income or capital which is taxable in the state of source or situs is exempted
in the state of residence , although in some instances it may b etaken into account in determining the rate of
tax applicable to the tax remaining income or capital.
2. CREDIT METHOD although the income or capital which is taxed in the state of source is still taxable in
the state of residence , the tax paid in the former is credited against the tax levied in the latter. The basic
diference between the two methods is that in the exemption method the focus is on the income or capital
itself , whereas, the credit method focuses upon the tax.
E. REMEDIES AGAINST DOUBLE OR MULTIPLICITY OF TAXATION
1. provision for tax exemption
2. allowance of tax credit for foreign taxes paid
3. allowance of deduction for foreign taxes paid
4. application of principle of reciprocity
5. enter into treaties and or agreement with foreign government
6. allowance and or application for tax incentives.
7. reduction of Philippine tax rate
20. FORMS OR ESCAPE FROM TAXATION
A. those that will not result in loss of revenue to the government
1. SHIFTING the process of transferring the tax burden from the statutory taxpayer to another without violating the
law. i.e VAT
2. CAPITALIZATION - The seller is willing to lower the price of the commodity provided the taxes will be
shouldered by the buyer
3. TRANSFORMATION The manufacturer absorbs the additional taxes imposed by the government
without passing it to the buyers for fear of loss of his market. Instead, he increases quantity of production , thereby
turning their units of production at a lower cost resulting to the transformation of the tax into gain through the medium
of production.
B . those that will result loss of revenue to the government
1. TAX EVASION also referred to as tax dodging . It is resorting to acts and devices that illegally reduces
or totally escape the payment of taxes that are due to the taxpayers . They are prohibited therefore are
subject to civil and or criminal penalties.
2. TAX AVOIDANCE (tax minimization skills) It is the reduction or totally escaping payment of taxes
through legally permissible means, that are not prohibited and therefore are not subject to penalties.
3. TAX EXEMPTIONS it is an immunity , privilege or freedom from payment of the charge or burden to
which others are obliged to pay.
21. TAX EVASION AND TAX AVOIDANCE
A. DEFINED.
TAX EVASION - It is resorting to acts and devices that illegally reduces or totally escape the payment of
taxes that are due to the taxpayers . They are prohibited therefore are subject to civil and or criminal penalties.
TAX AVOIDANCE
B. DIFFERENTIATE
TAX EVASION TAX AVOIDANCE
It is a scheme used outside those of lawful means to
escape payment of taxes and when availed of it usually
subjects the taxpayer to penalties .
It is a tax saving device within the means sanctioned by
law . they are not punishable by law.
It is accomplished by breaking the law Accomplished by legal procedure and do not violate the
letter of the law
It connotes fraud , deceit and malice No fraud is involved.
C. FACTORS THAT CONSITUTE TAX EVASION
A. payment of an amount of tax less than what is known by the taxpayer to be legally due
b. an accompanying state of mind which is evil , in bad faith , deliberate , willful or intentional and not merely
incidental
c. a cause of action or failure of action which is unlawful
d. INSTANCES OF TAX EVASION
22. EXEMPTION FORM TAXATION
A. DEFINITION
- it is an immunity , privilege or freedom from payment of the charge or burden to which others are obliged to
pay.
B. NATURE
-It is inherent. It has exclusive power to prescribe who and what property shall be taxed and those that shall
be exempt.
c. CHARACTERISTICS OF A TAX EXEMPTION PRIVILEGE
a. It is personal to the grantee. Hence, it is not transferable.
b. it is mere privilege of the grantee , thus revocable unless founded on a contract .
c. It implies a waiver on the part of the government to its right to collect what otherwise would be
due to it.
d. It is required that it be based upon substantial diferences between those exempted from those
covered or subject thereto.
d. HOW CREATED?
e. SOURCES OF TAX EXEMPTION
F. TYPES OF TAX EXEMPTIONS
1. as to creation
2. as to object
3. as to extent
g. GROUND FOR TAX EXEMPTION
1. it may be based on a contract
2. It may be based on grounds of public policy granting tax exemptions to rural banks and
sweeptakes or lotto winnings
3. it may be based on some grounds to foster charitable and other benevolent institutions.
4. It may be created under a treaty on grounds of reciprocity
5. It may be created to lessen the rigors of internation
H. PRINCIPLES GOVERNING TAX EXEMPTIONS
- they are not automatic
- they are non transferrable
- it is not perpetual
- it is never presumed to exist
- they are revocable ( except when granted by a valid contract
- the rule on exemption shall be uniform
- it does not contravene the lifeblood doctrine
- tax deduction for income tax purposes partake of the nature of tax exemptions and are strictly construed
against the taxpayer , who must prove by convincing evidence that he is entitled to the deduction claimed
- allowed only under a clear and unequivocal provision of the law, it cannot be merely implied therefrom or be
claimed under vague inferences
- GOCCs that own and operate local water districts are exempt from real property tax on the machinery and
equipment actually, directly and exclusively used in theior business but not the water or electricity that these
machineries generate and distributes.
- real property tax exemptions will be based on the doctrine of usage and not the doctrine of ownership
- real properties owned by the government are absolutely exempt from taxation regardless of how it is used.
But when the benefcial use thereof is transferred to a prvate individual the same property becomes a taxable
property . The burden of taxation is shifted to the benefcial user.
- local government cannot grant tax exemption on real property taxes but can condone real property tax
liabilities in special cases.
- local government can grant tax incentives on local taxes but cannot condone existing liabilities on local
regulatory taxes.
I . CONSTRUCTION OF TAX EXEMPTIONS STATUTE
J. EXCEPTIONS TO THE STRCIT CONSTRUCTION RULE
K.. EXTENT OF TAX EXEMPTIONS
1. tax exemption does not include exemption form license fee or charges
2. does not include special assessment
3. not include exemption from payment of toll
4. not include exemption form a margin fee
5. exemptions from fxed taxes do not include or cover exemption from income tax
6. tax exemption granted to a corporation does not extend to its stockholders
7. exemptions from taxes and assessment does not include exemption from permit fees
8. tax exemptions granted to the traditional exemptees does not include the exemtion from building
permit fees on any improvement to be constructed on their properties.
9. a buyer exempted from a tax does not mean that the seller is also exempted
10. a person or entity exempt from paying national taxes is not exempt from paying local taxes
11. exemption granted to meralco from local taxes does extend to real property taxes
12. the exemption of GOCCs from real property tax in the use of real property owned by the
government does not include the realty tax on improvement.
L. IN LIEU OF ALL TAXES DEFINED - applies only to national internal revenue taxes and not to local taxes
unless the exemption clearly provide for exemption from both taxes
M. DOCTRINE OF USAGE this is attest of exemption on real properties which mandates that such properties must
be actually, exclusively, directly used for religious charitable and educational purposes . The gauge of the exemption
is the use of the property and not the ownership.
N. TAX AMNESTY. - it is a general pardon or intentional overlooking by the state of its authority to impose penalties
on persons otherwise guilty of tax evasion or violation of a tax law. The purpose is to give the erring taxpayer a
chance to reform and become part of the society with a clean slate.
O.
TAX EXEMPTION TAX AMNESTY
There is immunity form tax Connotes condonation from payment of an existing tax
liability
The grantee does not need to pay anything The grantee pays a portion
Can be availed by any qualifed taxpayer Not always available
Prospective in application Retroactive
Tax liability does not attach top one enjoying a privilege
of tax exmption
The liability attaches to a taxpayer who wants to avail of
tax amnesty
Immunity form civil liability only Immunity form civil, criminal and administrative
Tax exemption requires no payment of tax Requires the payment of certain percentage of unpaid
taxes