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Module 1 - Part 1

The document discusses the three inherent powers of the state: taxation, police power, and eminent domain. It provides details about each power, including their concepts, scopes, authorities, purposes, and similarities/differences. The powers allow a sovereign state to legislate for public welfare, take private property for public use with compensation, and enforce tax contributions to support the government. Taxation is considered the most important inherent power as it supports the other powers and is necessary for a nation's existence.

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trixie mae
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68 views

Module 1 - Part 1

The document discusses the three inherent powers of the state: taxation, police power, and eminent domain. It provides details about each power, including their concepts, scopes, authorities, purposes, and similarities/differences. The powers allow a sovereign state to legislate for public welfare, take private property for public use with compensation, and enforce tax contributions to support the government. Taxation is considered the most important inherent power as it supports the other powers and is necessary for a nation's existence.

Uploaded by

trixie mae
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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MINDANAO STATE UNIVERSITY - GENERAL SANTOS CITY

COLLEGE OF BUSINESS ADMINISTRATION AND ACCOUNTANCY


DEPARTMENT OF ACCOUNTANCY

ACT184: INCOME TAXATION


GENERAL PRINCIPLES AND CONCEPTS OF TAXATION: Inherent Powers of the State
PART 1

LESSON OBJECTIVES
At the end of this module, you will be able to:
a. Know the different inherent powers of the state and its nature;
b. Know the similarities and differences of these powers.

OVERVIEW
Before entering Income Taxation, you need to finish this chapter. This will serve as your general
knowledge about taxation. It’s a sort of mind conditioning wherein you will be able to know what
taxation is all about. It’s more on answering the why’s and what’s of taxation. All learnings you’ll
get with this module will be beneficial for you as you go along with the subject. This module
focuses on the inherent powers of the state.

ACTIVITY
INSTRUCTION: Determine what Inherent Power of the State is being exercised in the following
situation.
1. General Santos City Public Airport announces to expand its area, acquiring massive lots owned
by residences nearby wherein they are paid for a just amount;
2. Mr. X was apprehended due to carrying of unregistered firearm or violating RA 10951;
3. Mrs. W was notified by the BIR to pay her unpaid liability amounting to P32,500;
4. The Congress pass a bill obligating online sellers to register as a business entity;
5. The LGU of General Santos City intended to build a public amusement park on a residential
area.

ANALYSIS
1. Why does the three inherent power of the state important?

2. Why does taxation, police power, and eminent domain called inherent power of the state?

3. Why is taxation considered the strongest or the most important among the three inherent
powers of the State?

ABSTRACTION

Inherent Powers of the State


When a sovereign state is born, it exists with indispensable powers necessary for its survival. The
powers are:
1. Police Power – the power to protect and provide safety and welfare of society. It refers to the
power of a sovereign state to legislate for the protection of health, welfare and morals of the
community. It is exercised usually to guard against excesses or abuses of individual liberty.
Examples of police power are preservation of natural resources, segregation of lepers from the
public, imprisonment of convicted criminals, and regulation pf various professionals.

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MINDANAO STATE UNIVERSITY - GENERAL SANTOS CITY
COLLEGE OF BUSINESS ADMINISTRATION AND ACCOUNTANCY
DEPARTMENT OF ACCOUNTANCY

2. Eminent Domain Power – the power to take private property with just compensation for public
use. It is base on the idea that the common necessities and interests of the community transcend
individual rights in property. The state may expropriate private property when it is necessary in
the interest of national welfare. Since eminent domain is inherent in sovereignty, pertinent
provisions om the Constitution are not grants of power but rather limitations upon its exercise.

3. Taxation Power – the power to enforce contributions to support the government, and other
inherent powers of the State. (see Module 2 for more discussion about the Power of Taxation)

SUMMARY DISTINCTION or SIMILARITIES


EMINENT
TAXATION POLICE POWER DOMAIN
1. As to concept Power to enforce Power to make and Power to take
contribution to raise implement laws for the private property for
government funds general welfare public use with just
compensation
2. As to scope Plenary, comprehensive, Broader in application – Merely a power to
and supreme general power to make take private
and implement laws. property for public
use
3. As to authority Exercised only by Exercised only by May be granted to
government or its political government or its public service or
subdivision political subdivisions public utility
companies.
4. As to purpose Money is taken to support Property is taken or Private property is
the government destroyed to promote taken for public use
general welfare

5. As to The power to make tax Can be expressly Can be expressly


necessity of laws cannot be delegated delegated to the local delegated to the
delegation government units by the local government
law-making body units by the law-
making body
6. As to person Operates on a community Operates on a Operates on the
affected or a class of individual community or a class of particular private
individual property of an
individual.
7. As to benefits Continuous protection Healthy economic Market value of the
and organized society standard of society property
expropriated

8. As to amount Generally, no limit Cost of regulation, No imposition


of imposition license and other
necessary expenses

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MINDANAO STATE UNIVERSITY - GENERAL SANTOS CITY
COLLEGE OF BUSINESS ADMINISTRATION AND ACCOUNTANCY
DEPARTMENT OF ACCOUNTANCY

9. As to Inseparable for the Protection, safety and Common


importance existence of a nation – it welfare of society. necessities and
supports police power interest of the
and eminent domain community
transcend
individual rights in
property.
10. As to Subject to Constitutional Relatively free from Superior to and
relationship to and inherent limitations Constitutional may override
Constitution limitations Constitutional
inferior to non-impairment impairment
clause Superior to non- provision because
impairment clause the welfare of the
State is superior to
any private
contract.
11. As to Constraints by Limited by the demand Bounded by public
limitation constitutional and for public interest and purpose and just
inherent limitations due process compensation

Similarities among Taxation, Eminent Domain, and Police Power


1. They are inherent in sovereignty; (they can be exercised even without being expressly granted
in the Constitution.)

2. They are all necessary attributes of sovereignty because there can be no effective government
without them;

3. They constitute the three ways by which the state interferes with private rights and property;

4. They are all legislative in nature and character; and

5. They presupposes an equivalent compensation.

ASSESSMENT
(AFTER FINISHING PARTS 1 to 3, ANSWER THE CHAPTER 1 EXERCISES.)

REFERENCES
Tabag, E. D. (2019). INCOME TAXATION. Manila: Info Page.
Valencia, E. G. (2017). Income Taxation. Baguio City: Valencia Educational Supply.

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