Question

A tax burden which can be shifted to another person and the impact and the incidence of tax lies on a different person is called

• A. Indirect tax
• B. Advalorem tax
• C. Direct tax
• D. Specific tax

Answer 1

The correct option is A

Indirect tax

Indirect tax refers to that tax which is imposed on one person but is paid partly or wholly by another. Thus, the impact and the incidence of these taxes are on different persons.