20-Quizzer - Lecture notes 2222 PDF

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QUIZZERTariff and Customs Code The BOC shall exercise the following duties and functions, except: a. Exercise of exclusive jurisdiction over forfeiture cases under the under the tariff and customs laws. b. Supervision and control over the imposition of excise taxes over imported goods. c. Supervisio...

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QUIZZER Tariff and Customs Code 1. The BOC shall exercise the following duties and functions, except: a. Exercise of exclusive jurisdiction over forfeiture cases under the under the tariff and customs laws. b. Supervision and control over the imposition of excise taxes over imported goods. c. Supervision and control over the handling of foreign mails arriving in the Philippines for the purpose of collecting revenues and preventing the entry of contraband. d. Supervision and control on all import and export cargoes, landed or stored in piers, airports, terminal facilities, including container.  Answer: B 2.

Statement 1: Tariff duties and customs duties are synonymous. Statement 2: Tariffs or customs duties are classified as regular tariffs or customs duties and special tariffs or customs duties. a. Only statement 1 is correct b. Only statement 2 is correct c. Both statements are correct d. Both statements are incorrect  Answer: C

3. Which of the following is a regular customs duty? a. Ad valorem customs duties b. Specific customs duties c. Mixed or compound customs duties d. All of the above  Answer: D 4. Which of the following statements on regular customs duties is correct? a. These are taxes that are imposed or assessed upon merchandise from, or exported to a foreign country for the purpose of raising revenue. b. They may also be imposed to serve as protective barriers which would prevent the entry of merchandise that would compete with locally manufactured items. Thus, they are also referred to as tariff barriers or protective tariffs. c. High tariffs on exports may also serve to discourage the exportation of certain articles, usually materials, in order to promote their manufacture into finished products. d. All of the above  Answer: D

5. Which of the following is a special custom duty? I. Anti-dumping duty II Countervailing duty III. Marking duty IV. Discriminatory duty a. I and II only c. I, II and III only b. II and IV only d. I, II, III and IV  Answer: D 6. Consider the following statements: I. The purpose of regular customs duties is to raise revenues to meet the needs of the government. II. The imposition of customs duties also assist in economic development. III. Customs duties are sometimes imposed to protect local customers. IV. Compound customs duties are computed only on the basis of units of measure such as weight, measurement, quantity, etc.

a. b. c. d.

After considering the above statements, choose the correct answer from the following choices: All the above statements are correct. Only statements I, III and IV are correct. Only statements I, II and IV are correct. Only statements I, II and III are correct.  Answer: D

7. It is a special duty charged whenever any product, commodity or article of commerce is granted directly or indirectly by the government in the country of origin or exportation, any kind or form of specific subsidy upon the production, manufacture or exportation of such product, commodity or article and importation of such subsidized product, commodity or article has cause or threatens to cause material injury to a domestic industry or has materially retarded the growth or prevents the establishment of a domestic industry. a. Anti-dumping duty c. Marking duty b. Countervailing duty d. Discriminatory duty  Answer: B 8. It is a special duty imposed in the event that a specific kind or class (any product, commodity, or article of commerce) of foreign article is being imported into, sold or is likely to be sold in the Philippines, at an export price less than its normal value in the ordinary course of trade for a like product, commodity or article destined for consumption in the exporting country which is causing or threatening to cause material injury to a domestic industry, or materially retarding the establishment of a domestic industry producing similar product.

a. Anti-dumping duty b. Countervailing duty

c. Marking duty d. Discriminatory duty

 Answer: A 9. Which of the following statements is correct regarding Marking Duty? a. The marking of articles (or its containers) is a prerequisite for every article or container of foreign origin which is imported into the Philippines in accordance with Section 303 of the ТССР. b. The marking shall be done in any official language of the Philippines and in a conspicuous place as legibly; indelibly permanently as the nature of the article (or container) may permit to indicate to an ultimate purchaser in the Philippines the country of origin of the article. c. In case of failure to mark an article or its container at the time of importation, unless otherwise excepted from the government requirements of marking, there shall be levied upon such article a marking duty of 5% ad valorem. d. All of the above  Answer: D 10. (2014 Bar Exam) Choose the correct answer. Smuggling a. does not extend to the entry of imported or exported articles by means of any false or fraudulent invoice, statement or practices; the entry of goods at less than the true weight or measure; or the filing of any false or fraudulent entry for the payment of drawback or refund of duties. b. is limited to the import of contraband or highly dutiable cargo beyond the reach of customs authorities. c. is committed by any person who shall fraudulently import or bring into the Philippines, or assist in so doing, any article, contrary to law, or shall receive, conceal, buy, sell or any manner facilitate the transportation, concealment or sale of such article after importation, knowing the same to have been imported contrary to law. d. None of the above  Answer: C 11. (Bar Exam) Under the Tariff and Customs Code, abandoned imported articles becomes the property of the a. government whatever be the circumstances. b. insurance company that covered the shipment. c. shipping company in case the freight was not paid. d. bank if the shipment is covered by a letter of credit.  Answer: A

12. (Bar Exam) is an article previously exported from the Philippines subject to the payment of customs duties? a. Yes, because all articles that are imported from any foreign country are subject to duty. b. No, because there is no basis for imposing duties on articles previously exported from the Philippines. c. Yes, because exemptions are strictly construed against the importer who is the taxpayer. d. No, if it is covered by a certificate of identification and has not been improved in value.  Answer: D 13. A violation of the tariff and customs laws is the failure to a. pay the customs duties and taxes and to comply with the rules on customs procedures. b. pay the customs duties and taxes or to comply with the rules on customs procedures. c. pay the customs duties and taxes. d. comply with the rules on customs procedures.  Answer: B 14. (BAR Exam) Amaretto, Inc., imported 100 cases of Marula wine from South Africa. The shipment was assessed duties and value-added taxes of P300,000 which Amaretto, Inc. immediately paid. The Bureau of Customs did not, however, issue the release papers of the shipment yet since the Food and Drug Administration (FDA) needed to test the suitability of the wine for human consumption. Is the Bureau of Customs at fault for refusing to release the shipment just as yet? a. Yes, because the importation was already terminated as a result of the payment of the taxes due. b. Yes, the Bureau of Customs is estopped from holding the release of the shipment after receiving the payment. c. No, if the amount paid as duties and value-added taxes due on the importation was insufficient. d. No, because the Bureau of Customs has not yet issued the legal permit for withdrawal pending the FDA's findings.  Answer: D 15. Importation of goods is deemed terminated (2012 Bar Question): a. When the customs duties are paid, even if the goods remain within the customs premises;

b. When the goods are released or withdrawn from the customs house upon of the customs duties or with legal permit to withdraw; c. When the goods enter Philippines territory and remain within the customs within thirty (30) days from date of entry; d. When there is part payment of duties on the

payment house

 Answer: B 16. The Bureau of Customs shall exercise the following duties and functions, except a. Assessment and collection of customs revenues from imported goods and other dues, fees, charges, fines and penalties under the tariff and customs code. b. Simplification and harmonization of customs procedures to facilitate movement of goods in international trade. c. Border control to prevent entry of smuggled goods. d. Prosecute persons illegally importing goods.  Answer: D 17. Which of the following statements is NOT a test of a valid ordinance? a. It must not contravene the Constitution or any statute. b. It must not be unfair or oppressive. c. It must not be partial or discriminatory. d. It may prohibit or regulate trade.  Answer: D BOI Registered Enterprises 18. Which of the following statements is correct? a. New registered firms under the Board of Investments enjoys income tax holiday for 6 years from commercial operations for 6 years from commercial operations for pioneer firms and 4 years for non-pioneer firms. b. The income tax holiday may be further extended not to exceed 8 years (maximum ITH) upon meeting certain conditions. c. For PEZA-registered enterprises, the income tax holiday is same with BOIregistered companies in general. d. All of the above  Answer: D 19. Which of the following statements is incorrect? a. BOI registered companies are subject to 5% gross income tax in lieu of national and local taxes. b. After Income Tax Holiday period, BOI registered companies are treated as ordinary corporations.

c. d.

BO1 registered companies are subject to zero rated (0%) vat. None of the above  Answer: A

foreign and local investors fiscal, providing or incentives, fiscal and non-fiscal, to preferred areas of investments, pioneer or non-pioneer, export production as well as rehabilitation or expansion of existing operation. Statement 3: Non-fiscal incentives include, among others, employment of foreign nations, simplification of customs procedure, unrestricted use of consigned equipment and multiple entry visa. a. Only statements 1 and 2 are correct b. Only statements 1 and 3 are correct c. All statements are correct d. All statements are incorrect  Answer: C 24. Which of the following is/are a non-fiscal incentive(s) granted to BOI registered enterprises? I. Employment of foreign nationals II. Simplification of customs procedure III. Unrestricted use of consigned equipment and multiple entry visa a. I only c. II and III only b. I and II only d. I, II and III  Answer: D 25. Which of the following incentives is/are granted to BOI registered enterprises? I. Tax Exemption II. Tax Credits III. Additional deductions from taxable income a. I only c. II and III only b. I and II only d. I, II and III  Answer: D 26. Which of the following tax incentives is/are granted to BOI registered enterprises? I. Income Tax Holiday (ITH) II. Exemption from taxes and duties on imported spare parts III. Exemption wharfage dues and export tax, duty, impost and fees IV. Tax exemption breeding stocks and genetic materials a. I and II only c. I, II and III only b. III and IV only d. I, II, III and IV

 Answer: D 27. Which of the following incentives, in addition to tax exemptions, is/are granted to BOI registered enterprises? I. Tax credit on tax and duty portion of domestic breeding stocks and genetic materials. II. Tax credit on raw materials and supplies III. Additional deductions for labor and expense (ADLE) a. I only c. II and III only b. I and II only d. I, II and III  Answer: D 28.

Statement 1: BOI registered enterprises are subject to 5% gross income tax in lieu of national and local taxes, except real property tax. Statement 2: PEZA registered enterprises are subject to 5% gross income tax in lieu of national and local taxes, except real property tax. a. Only statement 1 is correct b. Only statement 2 is correct c. Both statements are correct d. Both statements are incorrect  Answer: B

29. Which of the following statements pertaining to Pioneer enterprises under EO 226 is correct? a. Pioneer enterprises are registered enterprises engaged in the manufacture, processing or production of commodities or raw materials that are not yet being produced in the Philippines on a commercial scale. b. Pioneer enterprises also involves the use of a design, formula, method, process or system of production or transformation of any element, substance or raw material into another raw materials or finished goods which is new and untried in the Philippines. c. Pioneer enterprises are also engaged in the pursuit of agricultural, forestry and mining activities and/or services and energy sectors. d. All of the above  Answer: D 30. __________ refers to the most recent list of the thirty (30) poorest provinces of the Philippines at the time of application determined by the National Economic Development Authority (NEDA) a. Pioneer enterprises b. Special Economic Zones (ecozones) c. Investment Priorities Plan (IPP) d. Less developed areas (LDA)

 Answer: D PEZA Registered Enterprises 31. _________ is a selected area with highly developed enterprises or which have the potential to be developed into agro-industrial, industrial, tourist/recreational, commercial, banking, investment, and financial centers. a. Pioneer enterprises b. Special Economic Zone (ecozone) c. Investment Priorities Plan (IPP) d. Less developed areas (LDA)  Answer: B 32. Incentives to enterprises locating in export processing zones a. Foreign merchandise, raw materials, equipment, spare parts, etc. brought into the zone shall not be subject to customs and internal revenue laws and regulations nor to local tax ordinances. b. BOI-registered enterprise incentives. c. Exemption from local taxes and licenses except real estate taxes. d. All of the above  Answer: D 33.

Statement 1: The PEZA law specifically provides that the ecozone shall be managed and operated by PEZA (not by any other government entity) as a separate custom territory. Statement 2: In keeping with the status of ecozone as separate custom territory, the PEZA is conferred the power and function to operate administer, manage and develop the ecozone, and to register, regulate and supervise the enterprises in ecozones. a. Only statement 1 is correct b. Only statement 2 is correct c. Both statements are correct d. Both statements are incorrect  Answer: C

34. ____________ are enterprises registered enterprises engaged in the manufacture, processing or production of commodities or raw materials that are not yet being produced in the Philippines on a commercial scale. a. Pioneer enterprises b. Non-pioneer enterprises c. Multi-national companies d. Export-oriented enterprises .

 Answer: A 35. To encourage investments in desirable areas of activity, following: A enterprises registered with True the BOI enterprises locating in less False developed areas (LDAS) MNCS establishing their True RHQs/ROHQs in the Philippines MNCs establishing their False regional warehouses in the Philippines enterprises locating in export True processing zones

EO 226 provides incentives to the B True

C True

D True

True

True

True

True

True

True

False

False

True

False

Yes

True

 Answer: C 36.

Statement 1: RA 7916 or the Special Economic Zone Act of 1995 (February 24, 1995) provides the framework for the transformation, formation and monitoring of certain designated areas in the country called special economic zones (ecozones) where companies and industries establishing their operations therein are given incentives and privileges. Statement 2: Enterprises locating or operating within the ecozones shaIl register with the Philippine Export Zone Authority (PEZA) and are entitled to similar in incentives granted as provided for under PD 66 or those provided under EO 226 (Omnibus Investment Code). a. Only statement 1 is correct b. Only statement 2 correct c. Both statements are correct d. Both statements are incorrect  Answer: C

37.

Statement 1: For PEZA purposes, the 5% gross income tax is in lieu of all taxes, excluding local taxes. Statement 2: PEZA registered enterprises paying the 5% tax on gross income are not liable for local business taxes and other charges normally due to the local government unit. a. Both statements are correct b. Both statements are not correct c. Only the first statement is correct d. Only the second statement is correct

 Answer: D 38.

Statement 1: PEZA income tax holiday incentives imply exemption from income tax. Statement 2: PEZA income tax holiday would mean that an entity entitled to it enjoys exemption from income tax only, unless expressly exempted from other taxes. a. Both statements are correct b. Both statements are not correct c. Only the first statement is correct d. Only the second statement is correct  Answer: B

39. A PEZA registered enterprise has a registered and an unregistered activity. The MCIT shall apply to: a. Registered activity b. Unregistered activity c. Both activities d. Neither registered or unregistered activity  Answer: B PWDs/Senior Citizens 40. Private entities that employ disabled persons who meet the required skills or qualifications, either as regular employee, apprentice or learner shall be entitled to an additional deduction from gross income equivalent to: a. 15% of the total amount paid as salaries and wages to PWDs. b. 25% of the total amount paid as salaries and wages to PWDS c. 50% of the total amount paid as salaries and wages to PWDs. d. 100% of the total amount paid as salaries and wages to PWDs.  Answer: B 41, Which of the following statements is not a requirement in order for private establishments employing senior citizens to be entitled to additional deduction from their gross income equivalent to fifteen percent (15%) of the total amount paid as salaries and wages to senior citizens? a. The employment shall have to continue for a period of at least one (1) year. b. The annual taxable income of the senior citizen does not exceed the poverty level as determined by NEDA. c. Both statements "a" and "b" d. Neither "a" nor "b"  Answer: A

42. Which of the following statements regarding discounts allowed to PWDs is incorrect? a. In case the seller provides promotional discounts, the PWD will have the option to choose either the promotional discount or the PWD discount. b. Only the PWD discount is exempted from vat. c. In cases where the PWD is also a senior citizen (SC), the PWD shall also be entitled to SC discount in order to maximize the discounts granted under Magna Carta for PWDs and SCs. d. None of the above.  Answer: C . Use the following data for the next two (2) questions: Mabuhay Services Corporation (MSC) provides 20% discount to senior citizens. It recorded the following during the year: Customers Senior Regular Citizen Total Receipts P8,000,000 P1,000,000 P9,000,000 Cost of services 5,000,000 Other deductible 2,000,000 expenses 43. The amount of gross receipts to be reported is a. P1,000,000 c. P9,000,000 b. P1,250,000 d. P9,250,000  Answer: D 44. The regular and special itemized deductions deductible from gross income of MSC is: a. P2,000,000 c. P5,250,000 b. P2,250,000 d. P7,000,000  Answer: B 45. The taxable net income of MSC is: a. P750,000 c. P1,750,000 b. P1,000,000 d. P2,000,000  Answer: D Solution: RECEIPTS: Regular customers SC (PIM / 80%)

P8,000,0000 1,250,000

Total gross receipts Less: Cost of services Other deductible expense (P2M + SC discount of P250,00) Taxable Net Income o o

P9,250,000 (5,000,000) (2,250,000) P2,000,000

The gross sales or receipts to be reported should be the undiscounted amount. The Senior citizen/PWD discount shall be reported as part of operating ex...