Chapter 2.docx

CHAPTER 2- VALUE ADDED TAX ON IMPORTATION Multiple Choice: Theory- Agricultural or marine food products: Part 1 1. Which agricultural product is VAT exempt on importation? a. Charcoal b. Wood c. Lumber d. Corn 2. Which importation is subject to VAT? a. Importation from abroad. b. Purchase of goods from economic zones in the Philippines c. Both A and B d. Neither A nor B 3. Which is not subject to VAT on importation? a. Importation of goods for personal use. b. Importation of goods fro business use. c. Purchase of goods from Ecozone entities. d. Purchase of goods from other domestic sellers. 4. Which of the following is subject to VAT on importation when imported? a. Books b. Table sugar c. Mushroom d. Ordinary salt 5. Which is non-food agricultural product is exempt from VAT on importation? a. Chicken manure b. Eggs c. Live hogs

d. Cattle 6. Which of the following is not exempt from VAT? a. Grapes b. Orange c. Orchids d. Kiwi fruit 7. Which seeding is vatable? a. Grafted mango seedlings b. Pomelo seedlings c. Narra seedlings d. Guava seedlings 8. Which agricultural produce is exempt from VAT? a. Rubber hem b. Abaca hem c. Copra d. Firewood 9. Which is vatable? a. Bamboo shoots b. Banana hearts c. Banana fruits d. Bamboo poles 10. Which is VAT exempt? a. Cotton soft wood b. Cotton seeds c. Cotton wool d. None of these

11. Which is taxable to value added tax? a. Sheep b. Sheep wool c. Cut sheep meat d. All of these 12. Which is VAT exempt? a. Coconut lumber b. Coconut broom sticks c. Coconut shells d. Coconut meat 13. Which is subject to VAT on importation? a. Wheat b. Coffee bean c. Barley d. Cocoa 14. Which agricultural product is subject to VAT? a. Honey b. Rattan cane c. Sugar cane d. Sugar beets 15. Which is subject to VAT on importation? a. Cocoon silk b. Pineapple silk c. Furniture d. All of these 16. Seedlings of this tree are exempt form VAT on importation?

a. Rubber tree b. Paper tree c. Palm oil tree d. Mahogany tree 17. The importation of which of the following is subject to VAT? a. Rubber b. Corn c. Cacao d. Peanut 18. Feeds of the following animals are considered as specialty feeds, except for a. Zoo animals b. Aquarium fish c. Livestock d. Fighting cocks 19. Which of the seeds is non-VAT exempt? a. Corn seeds b. Mustard seeds c. Flower seeds d. Cabbage seeds 20. Which of the following feeds is subject to VAT on importation? a. Formulated horse feeds b. Corn grits c. Swine feeds d. Broiler feeds

Multiple Choice: Theory- Agricultural or marine food products: Part 2 1. Which is VAT exempt? a. Peacock feathers b. Eggs c. Hamster d. Leather 2. Which is vatable on importation? a. Tea leaves b. Tobacco leaves c. Cayenne pepper d. Chinese cabbage 3. Which of these is VAT exempt on importation? a. Almonds b. Blueberries c. Ginseng roots d. All of these 4. Which is not exempt from VAT? a. Sunflower seeds b. Bees wax c. Peanut d. None of these 5. Which is not generally considered as pet under the regulation? a. Rabbit b. Zoo animals c. Race horse d. Fighting cocks

6. Which of these is non-vatable? a. Love birds b. Parrots c. Goldfish d. Milkfish 7. Which is not a VAT-exempt poultry? a. Ducks b. Geese c. Turkeys d. Gamefoul roosters 8. Which of theses animals is vatable when imported? a. Cow b. Rabbit c. Goat d. Race horse 9. Which is a vatable agricultural input? a. Fertilizer b. Pesticides c. Seeds d. Seedlings 10. The following are generally considered as pets hence vatable when imported except for a. Janitor fish b. Goldfish c. Catfish d. Koi fish 11. Which of these is taxable with VAT on importation?

a. Yellowfin tuna b. Pink salmon c. Blue marlin d. Butterfly fish 12. Which of the following seafood is considered as vegetable; hence, VAT-exempt? a. Kelp b. Sea lettuce c. Sea grapes d. All of these 13. Which of these is vatable? a. Sea shells b. Octopus c. Squid d. Shrimps 14. Examples of mollusk and shellfish: A. Crabs

B. Oysters

C. Lobsters

D. Clams

Which of these is subject to VAT on importation? a. A and D b. B and C c. All of these d. None of these 15. Which of these agricultural products is not considered as in its original state? a. Kopra b. Muscovado sugar c. Refined sugar d. Ordinary salt

16. By revenue regulation, which of the items below is not considered original state? a. Marinated fish b. Dried fish c. Frozen meat d. Smoked fish 17. Which product is non-taxable with VAT on importation? a. Fresh cow milk b. Olive oil c. Butter d. Parmesan cheese 18. Which of the items below is taxable with VAT? a. Shrink-wrapped meat b. Vacuum-packed vegetables c. Tetra-packed fresh fruit juice d. Canned fruits 19. Which is not considered as simple processing? a. Freezing b. Stripping c. Broiling d. Marinating 20. The following advanced technological means of packaging is deemed not to alter the nature of an agricultural marine food products being in original state. Which is the exception? a. Canning b. Vacuum-packing c. Plastic shrink wrapping d. Tetra-packing Multiple Choice: Theory- Other exempt importation

1. Which is not exempt from VAT on importation? a. Importation of books b. Importation of school supplies c. Importation of magazines d. All of these 2. Which importation is not VAT-exempt? a. Importation of personal and household effects of residents coming to resettle in the Philippines b.

Importation of personal and household effects of foreigners coming to settle permanently in the Philippines

c.

Importation of personal and household effects which are subject to custom duties

d. All of these 3. The importation of professional instruments and implements may be subject to

VAT when the

a. Volume is not in commercial quantity. b. Goods accompany the person or arrive within 30 days before and after his arrival. c. Importation involves vehicles and machineries. d. All of these 4. Which importation is exempt from VAT? a. Importation of books by a school b. Importation of books by a student c. Importation of books by a bookstore d. All of these

5. The importation of which transport medium is exempt from VAT? a. Sea b. Air c. Land

d. A and B 6. Examples of Transport vehicles: a. Bus b. Cars c. Vessels d. Aircraft Which of these is not exempt from VAT when imported? a. C and D b. A and B c. All of these d. None of these 7. Which importer is exempt from VAT in importation of fuel, goods and supplies? a. Domestic carriers b. International carriers c. Domestic carriers on their international operations d. Either B and C 8. Which of the following items is subject to VAT on importation to an individual who is intending to settle in the Philippines? a. Vehicles b. Professional instruments c. Household effects d. Personal effects 9. The importation of fuel, goods and supplies is not exempt from VAT when used in a. Domestic operation b. International shipping operations c. Household effects d. Personal effects

10. Which is vatable? a. Importation of life saving equipment b. Importation of safety or rescue equipment c. International transport operations d. Any of these

11. The importation of vessel or aircraft for domestic operations is a. Vatable. b. Always VAT exempt. c. VAT exempt if the importer complies with maximum service life set by law. d. Vatable if the importer complies with maximum sevice life set by law. 12. The importation of fuels, goods and supplies for domestic shipping or air transport operation is a. Vatable. b. Always VAT exempt. c. Vatable if the importer is a domestic carrier. d. Exempt if the importer is a domestic carrier.

13. The importation of farm machineries and equipment is exempt when imported by a. A member of the cooperative b. A trader engaged in business. c. An agricultural cooperative. d. A or C 14. Who has the burden of proving exemption from VAT on importation? a. The government b. The importer-buyer c. The seller

d. Both A and C 15. Which is a qualified exempt importation? a. Importation of a cooperative of farm equipment b. Importation by a cooperative of rice c. Importation of books d. Importation of marine food products 16. Which is not a qualified exempt importation? a. Importation of fuels or supplies by a person engaged in domestic transport operations b. Importation of fuels or supplies by an international carrier c. Importation of cargo vessels and aircraft by those engaged in international transport operations 17. Which of these is non-vatable? a. Purchase of services from a foreign service provider who is not engaged in business b. Purchase of goods from a foreign service provider who is engaged in business abroad c. Purchase of goods from economic zone enterprises d. None of these 18. Who shall pay the VAT on importation when a VAT on importation when a VAT-exempt entity subsequently sells an imported article or goods to a non-exempt entity? a. The exempt buyer b. The non-exempt buyer c. Both A and C d. Neither A nor C 19. Importation is not subject to VAT when a. Made by a VAT-registered business b. Made by a non-VAT-registered business c. It involves exempt goods d. Coursed through an exempt importer

20. Which is not included in landed cost? a. Dutiable value b. Custom's duty c. Excise tax d. VAT 21. Which is not included in the landed cost? a. Purchase price b. All incident cost of bringing the goods to the customs warehouse c. Taxes other than VAT paid prior to the withdrawal of the goods d. Cost of transporting the goods from customs warehouse the importer's warehouse or residence

Multiple Choice- Problem 1 1. Oceanizers, Inc. Purchased the following from abroad: Sea shells and coral decors

P320,000

Tuna and salmon

P120,000

Total

P440,000

What is amount of taxable importation? a. P0 b. P120,000 c. P200,000 d. P320,000 2. Mr.A imported various personal and household effects with a value aggregating P400,000. P320,000 of these was subjected to a 8% customs duty by the BOC. What is the VAT on importation? a. P0

b. P41,472 c. P42,240 d. P48,000 3. A bookstore company imported the following items: Landed Cost Books

P 350,000

Professional instruments

200,000

School Supplies

350,000

Total

P 900,000

What is the total VAT on importation? a. P 0 b. P 66,000 c. P 72,000 d. P 108,000 4. Mr. C, a VAT- registered food retailer, imported the following from China: Landed Cost Fruits Vegetables Frozen meat

P 250,000 180,000 50,000

Marinated milkfish

100,000

Total

580,000

Compute the VAT on importation. a. P 0 b. P 12,000 c. P 51,600 d. P 69,600

5. Alexis furnitures, a percentage taxpayer, imported the following household equipment: Landed costs Machineries, for business use

P 1,150,000

Heating system, for home use

250,000

Total

1,400,000

Compute the VAT on importation. a. P 0 b. P 27,000 c. P 150,000 d. P 168,000 6. Danes AgriCorp imported the following: Landed Costs Seeds

P 400,000

Fertilizers

750,000

Farming equipment

450,000

Herbicides and Pesticides

250,000

Total

P1,850,000

Compute the VAT on importation. a. P 0 b. P 42,000 c. P 72,000 d. P 84,000 7. Home Appliance Company imported the following for personal use: Furniture Rattan Lumber

P 600,000 250,000 450,000

Compute the VAT on importation. a. P 30,000 b. P 72,000 c. P 156,000 d. P 204,000 8. Mr. Huligan imported rice from Viertnam. Details of his importation show the following: Total invoice value

P 1,000,000

Freight and insurance in transit

P 350,000

BOC and other charges

P 300,000

Compute the VAT on importation. a. P 0 b. P 120,000 c. P 126,000 d. 128,400 9. An agricultural supply dealer imported the following: Corn grits Hog feeds Specialty feeds

P 200,000 P 350,000 P 300,000

Compute the VAT on importation a. P 0 b. P 36,000 c. P 42,000 d. P 102,000 10. The following data relates to the importation of cigarettes by Mr. Shinto: Total invoice value

P 1,000,000

BOC charges

P 300,000

Customs duties

P200,000

Excise taxes

P300,000

Compute the VAT on importation. a. P 120,000 b. P 156,000 c. P 180,000 d. P 216,000

Multiple Choice: Problems 2 1. Don Pepito imported a harvester from the United States with a total cost of P 1,100,000 before Customs duties. The importation is subject to 10% Customs duties. What is the VAT on importation? a. P 158,400 b. P 145,200 c. P 129,600 d. P 0 2. In the immediately preceding problem, assuming that the importation is made by an agricultural cooperative, What is the VAT on importation? a. P 158,400 b. P 144,000 c. P 129,600 d. P 0 3. Mr. Smile, a professional practitioner, imported the following: Calculators and computers for his firm

P 900,000

Books

P 600,000

Total

P 1,500,000

How much is subject to VAT on importation? a. P 0 b. P 900,000 c. P 1,200,000 d. P 1,500,000 4. Mr. Juan Manuel Marquez arrives in the Philippines with an immigration visa. He had with him the following: Clothing, shoes and apparels

P 100,000

Professional instruments and implements

P150,000

Personal car

P300,000

Total costs of personal belonging

P550,000

Compute the total amount subject to the VAT on importation? a. P 0 b. P 200,000 c. P 300,000 d. P 550,000 5. Mr. Xhi, a non-VAT taxpayer, made the following domestic purchases of goods: Purchase of scrap metals from a PEZA- locator

P200,000

Purchase of machine from a VAT supplier

P800,000

What is the imposable VAT on importation? a. P 0 b. P 24,000 c. P 96,000 d. P 120,000 6. Atlantis Shipping Company imported P 3,000,000 worth of vessel fuels and supplies for domestic use. The company earmarked 60% of this for domestic use while 40% is reserved for its international operations. What is the VAT on importation?

a. P 0 b. P 144,000 c. P 216,000 d. P 360,000 7. Mr. Beer, a VAT- registered trader, imported an equipment with a dutiable value of $40,000 from abroad. The importation is subject to P 100,000 BOC charges before 10% customs duties on dutiable value. The exchange rate to the peso was P 43.00:$1. Compute the VAT on importation. a. P 218,400 b. P 227,040 c. P 232,400 d. P 239,040 8. If an importer paid 15% customs duties in the amount of P 24,000 plus P 134,000 charges in the Bureau of Customs, what is the VAT on importation? a. P 0 b. P 18,960 c. P 35,280 d. P 38,160 9. Shanum Company had the following data regarding its importation: Invoice price in US dollar Other costs to bring goods to the Philippines BOC charges

$ 12,000 P 145,000 P 100,000

Customs duties is 10% of dutiable value Peso-Dollar Exchange rate Compute the VAT on importation. a. P 0 b. P 81,643.20 c. P 91,032.00

P 42.80:$1

d. P 98,935.20 10. Mr. Dolinger imported various merchandise from abroad. The importation was invoiced at $ 5,000. Mr. Dolinger also incurred the following costs of importation: Insurance Freight

P 4,000 P 15,000

Wharfage fee

P 4,000

Arrastre charge

P7,000

Brokerage fee

P8,000

Facilitation fee

P5,000

Mr. Dolinger was also assessed P 24,000 and P 18,000 customs duties and excise tax, respectively. The applicable exchange rate was P 42.50:$1 What is the VAT on importation? a. P 25,500 b. P 30,540 c. P 35,100 d. P 35,700