Taxation is defined as a fee charged by a government on a product, income, or activity.

Taxation is the act of laying a tax, or of imposing taxes, as on the subjects of a state Nature of taxation 1. Inherent power of sovereignty 2. Legislative in nature 3. Public purpose 4. Territorial in operation 5. Exemption of the government 6. Strongest among the inherent power of the state 7. Subject of constitutional and inherent Characteristics 1. enforced contribution. 2. Generally payable with money. 3. proportionate in character. 4. levied on persons or property 5. levied by the state which has jurisdiction mover the subject 6. levied by the law-making body of the state. 7. commonly required to be paid at regular periods or intervals.

The power to tax is an incident of sovereignty and is unlimited in its range, acknowledging in its very nature no limits, so that security against its abuse is to be found only in the responsibility of the legislature which imposes the tax on the constituency that is to pay it. Thus, the theory behind the exercise of the power to tax emanates from necessity; without taxes, government cannot fulfill its mandate of promoting the general welfare and well-being of the people. police power is the power of the state to promote public welfare by restraining and regulating the use of liberty and property. It is the most pervasive, the least limitable, and the most demanding of the three fundamental powers of the State. Police power describes the basic right of governments to make laws and regulations for the benefit of their communities. Eminent domain is an exercise of the power of government or quasi-government agencies (such as airport authorities, highway commissions, community development agencies, and utility companies) to take private property for public use. Sometimes these entities may propose to use their eminent domain authority to take public housing property.

Sound tax policy Fiscal adequacy. Means that the sources of revenue taken as a whole should be sufficient to meet the expanding expenditures of the government regardless of business, export taxes, trade balances, and problems of economic adjustment. Revenues should be capable expanding or contracting annually in response to variations of public expenditures. it must be adequate to support the needs of the government. Equality or Theoretical Justice. Means the taxes levied must be base upon the ability of the citizen to pay. - in consonance with the constitutional provisions that the rule of taxation must be equitable ( burden falls on those better able to pay), and uniform. Further it must be progressive ( tax rate increases depending upon the resources of the person affected. Administrative Feasibility. This principle connotes that in a successful tax system, such tax should be clear and plain to taxpayers, capable of enforcement by an adequate and well-trained staff of public office, convenient as to the time and manner payment, and not unduly burdensome upon on discouraging to business activity. must be capable of effective and efficient enforcement.

Constitutional limitations = provide for in the constitution/implied from its provision Observance of due process of law and equal protection of the laws All taxable articles or properties of the same class shall be taxed at the same rate No imprisonment for non-payment of poll tax(community tax) Prohibition against infringement of religious freedom is violated by the imposition of a license fee on the distribution and sale of bibles and other religious literature not for any profit Prohibition against appropriations for religious purpose

Inherent limitations = restrictions to the power to tax attached to its nature. Purpose taxes may be impose only for public purpose Territoriality state may tax persons and properties under its jurisdiction International Comity property of a foreign state may not be taxed by another Exemption govt agencies performing governmental functions are exempted from taxation Non-delegation power to tax being in legislative in nature may not be delegated(subj to exemp)