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| Neeta Shah |
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A fee charged or levied by government on .......
a product, income,or activity. directly on personal or corporate in
come, then it is a direct tax. If tax is levied on the price of a good
or service, then it is called an indirect tax. The purpose
of taxation is to finance government expenditure. One of the
most important uses of taxes is to finance public
goods and services, such as street lighting and street cleaning.
Since public goods and services do not allow a non-payer to be
excluded, or allow exclusion by a consumer, there cannot be
a market in the good or service, and so they need to be provided
by the government or a quasi-government agency, which tend to
finance themselves largely through taxes.
come, then it is a direct tax. If tax is levied on the price of a good
or service, then it is called an indirect tax. The purpose
of taxation is to finance government expenditure. One of the
most important uses of taxes is to finance public
goods and services, such as street lighting and street cleaning.
Since public goods and services do not allow a non-payer to be
excluded, or allow exclusion by a consumer, there cannot be
a market in the good or service, and so they need to be provided
by the government or a quasi-government agency, which tend to
finance themselves largely through taxes.
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