Question:
Which of the following is considered a direct tax?
(1) Value Added Tax (VAT)
(2) Excise Duty
(3) Nation Building Tax (NBT)
(4) Pay As You Earn (PAYE) tax
(5) Customs Duty
Correct Answer:
(4)
Answer Explanation:
Direct taxes are levied directly on the income or wealth of individuals and corporations, and the burden cannot be shifted. PAYE (Pay As You Earn) is an income tax deducted directly from an employee’s salary. The others are indirect taxes levied on goods and services.
Topic: Public Finance Year: 2019
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