Question

Distinction between the direct and indirect tax

Answer 1

Direct Tax	Indirect Tax
1. Burden cannot be shifted by taxpayers	Easily be shifted to another person
2. Tax is imposed on personal income and corporate income	Taxes imposed on various goods and services
3. Direct tax has no inflation pressure	This tax has inflation pressure
4. The impact and incidence are the same in case of direct tax	The impact and incidence are different in case of indirect tax
5. Direct tax is less elastic	Indirect tax is more elastic