Practice question
A corporation pays the Philippine income tax imposed under the NIRC income-tax title. It seeks to deduct that very income-tax payment from gross income under Section34(C), saying every business-related tax is deductible. No special relief applies. Which answer is correct?
- Section34(C)(1)(a) expressly excludes that income tax from the deduction category
- Every domestic income-tax payment is automatically a deductible operating cost
- Payment converts it into a foreign income-tax credit
- The tax may be deducted merely by calling it a service fee
- The exception disappears whenever the corporation earns a profit
Legal references
- NIRC RA8424, relevant provisions as amended: https://lawphil.net/statutes/repacts/ra1997/ra_8424_1997.html Section34(C)(1)(a).
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