Taxation, 2011 Bar — Question 66

MULTIPLE CHOICE

Lualhati Educational Foundation, Inc., a stock educational institution organized for profit, decided to lease for commercial use a 1,500 sq. m. portion of its school. The school actually, directly, and exclusively used the rents for the maintenance of its school buildings, including payment of janitorial services. Is the leased portion subject to real property tax? (A) Yes, since Lualhati is a stock and for profit educational institution. (B) No, since the school actually, directly, and exclusively used the rents for educational purposes. (C) No, but it may be subject to income taxation on the rents it receives. (D) Yes, since the leased portion is not actually, directly, and exclusively used for educational purposes.

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