McqMate
| Q. |
Which one of the following is NOT an example of indirect tax? |
| A. | Sales tax |
| B. | Excise duty |
| C. | Customs duty |
| D. | Expenditure tax |
| Answer» D. Expenditure tax | |
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Explanation: 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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