Question

In which one of the following groups of taxes, do impact and incidence of tax coincide?

• A. Income tax and corporation tax
• B. Income tax and excise duties
• C. Corporation tax and custom duties
• D. Excise duties and sales tax

Answer 1

The correct option is A Income tax and corporation tax

Direct Tax: A tax is said to be a direct tax, when it is not intended to be shifted to any-body else. The person who pays it in the first instance is also expected to bear it. This, impact and incidence of direct tax fall on the same person and shifting of direct tax is not possible.
Central Govt's Direct Tax
(i) Personal Income Tax and Corporate Tax
(ii) Gift Tax and Estate Tax
(iii) Expenditure Tax and Wealth Tax
(iv) Capital Gain Tax and Dividend
(v) Interest Tax.