Which one of the following is a Direct Tax?
Taxation plays a very significant role for collecting the revenue for a government. As per the nature of tax incidence, tax are classified into two broad categories;
- Direct tax
- Indirect tax
Direct Tax: Taxes which can not be shifted on other are known as direct tax, In other words tax liability and the payment of tax lies on the same person and he cannot recover from other for e.g. Income tax, Wealth tax are direct tax.
Indirect tax: Taxes which can be shifted on other are known as Indirect tax, In other words tax payer recovers the tax amount from other i.e. clients, customers, subscribers, policy holders etc. example indirect tax are Service tax, Sales tax, Excise duty etc.