Taxation, 2019 Bar — Question A.10

QUESTION

In 2018, City X amended its Revenue Code to include a new provision imposing a tax on every sale of merchandise by a wholesaler based on the total selling price of the goods, inclusive of value-added taxes (VAT). ABC Corp., a wholesaler operating within City X, challenged the new provision based on the following contentions: 1. the new provision is a form of prohibited double taxation because it essentially amounts to City X imposing VAT which was already being levied by the national government; and 2. since the tax being imposed is akin to VAT, it is beyond the power of City X to levy the same. Rule on each of ABC Corp.'s contentions. (5%)

You can write freely without an account. Sign in to reveal the suggested answer and track your progress.