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Economics miscellaneous

  1. Which one of the following is NOT an example of indirect tax?
    1. Sales tax
    2. Excise duty
    3. Customs duty
    4. Expenditure tax
Correct Option: D

Expenditure tax is a taxation plan that replaces the income tax (a direct tax). Instead of applying a tax based on the income earned, tax is allocated based on the rate of spending. This is different from a sales tax, which is applied at the time the goods or services are provided and is considered a consumption tax. The major benefit for this type of tax scheme is the removal of double taxation.



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