Direct Taxation and Economic Growth
Volume III, Issue III, 2020
A well-structured taxation system prevails in India. Taxes here are the largest source of revenue for the government. This money is deployed for various purposes and projects for the development of the nation. Taxes are levied by the Central and State Governments along with local authorities such as municipal corporations.
Taxes are categorised under two heads – direct and indirect. Direct tax is a tax levied on corporate entities and individuals which is payable directly to the government and is not transferrable. Examples are gift tax, income tax, wealth tax. Indirect tax, on the other hand is not directly paid by the assessed. It is levied on goods and service and is paid by the intermediaries who is usually the seller of those goods and services to the government.