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Which of the following is a direct tax?
GST
Income Tax
Excise Duty
Sales Tax
Income Tax
Income Tax is classified as a direct tax because its burden cannot be shifted to another person, and it is levied directly on the income earned by individuals and entities. Conversely, indirect taxes like GST, Excise Duty, and Sales Tax are levied on goods and services where the incidence and impact fall on different persons.
Income Tax is classified as a direct tax because its burden cannot be shifted to another person, and it is levied directly on the income earned by individuals and entities. Conversely, indirect taxes like GST, Excise Duty, and Sales Tax are levied on goods and services where the incidence and impact fall on different persons.
Under the Seventh Schedule of the Constitution of India, the power to levy taxes on income other than agricultural income falls under the Union List (Entry 82).
Direct taxes are paid directly by the individual or organization to the government, such as Income Tax and Corporate Tax.
Indirect taxes are initially paid by an intermediary, who then shifts the tax burden to the ultimate consumer.
Goods and Services Tax (GST) is a comprehensive indirect tax subsuming multiple central and state indirect levies.
Option A (GST) is an indirect destination-based consumption tax implemented via the 101st Constitutional Amendment Act.
Option C (Excise Duty) is an indirect tax levied on the manufacture or production of specific goods within the country.
Option D (Sales Tax) is an indirect tax historically levied on the sale of goods, largely subsumed by GST except for specific items.
B is correct тАФ Income Tax is a direct tax where the incidence and burden fall on the same taxpayer.
Aspirants should clearly distinguish between Union List and State List taxation powers under Article 246 of the Indian Constitution, as exam questions frequently test the classification of various taxes.
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