Introduction + Tax Rates | LECTURE - 01: CA Final Direct Tax by CA Vinod Gupta

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Topic:
Introduction + Tax Rates | LECTURE - 01

Direct taxes in the United States are largely based on the ability-to-pay principle. This economic principle states that those who have more resources or earn a higher income should bear a greater tax burden. Some critics see that as a disincentive for individuals to work hard and earn more money because the more a person makes, the more taxes they pay.

Direct taxes cannot be passed on to a different person or entity. The individual or organization upon which the tax is levied is responsible for paying it.
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A direct tax is the opposite of an indirect tax, wherein the tax is levied on one entity, such as a seller, and paid by another—such as a sales tax paid by the buyer in a retail setting. Both kinds of taxes are important revenue sources for governments


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