Question

Which of the following holds true for an indirect tax _____.

• A. the tax is levied on wealth
• B. the tax is levied on all kinds of income
• C. point of impact and incidence are different
• D. the tax is levied on property

Answer 1

Answer: (C)

point of impact and incidence are different

1:Indirect tax is a type that is paid to the government indirectly i.e tax on goods and services rather than on income and profits. Examples of indirect tax include VAT, excise duty, service tax, customs duty, etc.
2:Point of impact and incidence is different for example we buy a commodity from shopkeeper(point of impact) and tax levied goes to government ( point of incidence).