Your friend, Aher, wants to be a candidate in upcoming election.He has a lot of great ideas, but he is not entirely clear on certain political and economic issues.He finds taxes, in particular, to be baffling.He therefore has asked you to teach him about a few basic concepts.His first question: "What is the difference between a direct tax and an indirect tax?"
A) A direct tax is created by the province alone; an indirect tax is created by the federal government on behalf of a province.
B) A direct tax is a tax imposed on the person who must pay it; an indirect tax is imposed one person with the expectation that the burden will be shifted to another.
C) A direct tax is imposed on a person who harvests or manufactures goods; an indirect tax is imposed on a person who deals with goods that someone else harvested or manufactured.
D) A direct tax is imposed on the person who first sells an item; an indirect tax is imposed on anyone who re-sells that same item.
E) A direct tax is any tax imposed by the federal government; an indirect tax is any tax imposed by a province.
Correct Answer:
Verified
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