Difference Between Direct Tax And Indirect Tax

Income tax is the portion of the income that one pays to the government for the payment of central and state government salaries , development of infrastructure and maintenance of the security of the country . The tax are levied on the law that is called income tax act , 1961. income tax is one of the many direct taxes that we play . The other direct taxes are capital tax , security transaction tax etc . The direct taxes are paid by the person directly .

The indirect taxes are paid by the consumers , when they use services at hotel , restaurants, in the form of service tax , entertainment tax ect . The other major indirect taxes are sale tax , value added tax , octroi etc . The income tax forms that major part of the revenue of the government of india . The function are managed by the ministry of finance and the direct handling responsibility is given to the central board of direct taxes . In direct tax has the effect of increasing the price of the products on which the tax is imposed .

                        

The example is the value added tax , which increases the price of the goods , which we buy . The VAT Consultants in Delhi NCR value added tax is imposed on the manufacturers , who then transfer the tax to the customers .Income tax has to be paid by the every individual , united Hindu family member , body of individual , corporate body , companies , local authorities and other person that generate the income that comes under the income tax slabs .

The income tax slabs may change from time to time and are not fixed for the longer duration . The tax are calculated on the annual income of the person . The year which is taken into calculation is the financial year not the normal year . The year in which the income is earned is called the previous year and the year in which the income is levied for tax is called assessment year .

                        

The taxes are collected by three ways by the government . The first is the voluntary payment of the tax like advanced tax and self assessment tax Income Tax Consultant in Delhi NCR . Then there is tax deduction at source , that is the deduction of the tax from the salary at the time of its payment every month . The final is tax collected . The government wants to bring the goods and services tax to remove several taxes and streamline the tax regime .