Question

Which of the following features is the merit of direct taxation?

• A. Certainty
• B. Uneconomical
• C. Arbitrary
• D. Possibility of evasion

Answer 1

The correct option is A

Certainty

The taxpayer knows how much tax is due and can adjust his or her income and expenditure. At the same time, the government also knows the amount of revenues coming to it by way of direct taxes and can adjust its income and expenditure. Hence, it is an advantage of certainty of direct taxes.