The main difference between direct and indirect taxes is that
A)indirect taxes are automatically deducted from workers' paychecks and direct taxes are not.
B)direct taxes are paid to state and local governments and indirect taxes are paid to the federal government.
C)direct taxes are taxes levied on people and indirect taxes are taxes levied on activities undertaken by people.
D)direct taxes are usually proportional and indirect taxes are usually progressive.

Question

Quizplus · Accepted Answer

Direct taxes are taxes that are levied on individuals and entities directly based on their income, wealth or property. Indirect taxes are those taxes that are levied on consumption rather than income or wealth. They are usually taxes on specific goods and services or activities such as sales tax, excise tax, and value-added tax (VAT). So, the key difference between direct and indirect taxes is the type of tax base. Direct taxes are levied on the taxpayer and indirect taxes are levied on the goods or services that the taxpayer consumes.

The Main Difference Between Direct and Indirect Taxes Is That