MANAGEMENT

Detailed explanation-1: -Temporary labor dispute is a valid ground for the suspension of MCIT. 11. Corporations exempt from income tax are not subject to income tax on incomes received which are incidental or necessarily connected with the purposes for which they were organized and operating.

Detailed explanation-2: -The MCIT is imposed whenever such corporation has zero or negative taxable income or whenever the amount of the MCIT is greater than the regular corporate income tax due from such corporation.

Detailed explanation-3: -Domestic corporations Minimum corporate income tax (MCIT) on gross income, beginning in the fourth taxable year following the year of commencement of business operations. MCIT is imposed where the CIT at 25% is less than 2% MCIT on gross income.

Detailed explanation-4: -A: The MCIT is equal to two percent (2%) of the gross income of the corporation at of the end of the taxable year. “Gross income” means sales less sales returns, discounts and allowances and cost of goods sold.

Detailed explanation-5: -The MCIT is imposed on gross income which is arrived at by deducting the capital spent by a corporation in the sale of its goods, i.e., the cost of goodsand other direct expenses from gross sales.