Auditing & Taxation

In: Business and Management

Submitted By SudiptaPaul
Words 1049
Pages 5
Assignment On
Impact of Indirect Tax in the Economic Growth of Bangladesh

Submitted to

Shish Haider Chowdhury

Course Instructor

Auditing & Taxation

Submitted By

Sudipta Paul

Class ID-1577

21st Batch

Date of Submission

07.09.2014

Institute of Business Administration

Jahangirnagar University

Indirect tax:
An indirect tax (such as sales tax, a specific tax, value added tax (VAT), or goods and services tax (GST)) is a tax collected by an intermediary (such as a retail store) from the person who bears the ultimate economic burden of the tax (such as the consumer). The intermediary later files a tax return and forwards the tax proceeds to government with the return. In this sense, the term indirect tax is contrasted with a direct tax which is collected directly by government from the persons (legal or natural) on which it is imposed. Some commentators have argued that "a direct tax is one that cannot be shifted by the taxpayer to someone else, whereas an indirect tax can be.
An indirect tax may increase the price of a good so that consumers are actually paying the tax by paying more for the products.[2] Examples would be fuell, liquor, and cigarette taxes. An excise duty on motor cars is paid in the first instance by the manufacturer of the cars; ultimately the manufacturer transfers the burden of this duty to the buyer of the car in form of a higher price. Thus, an indirect tax is such which can be shifted or passed on. The degree to which the burden of a tax is shifted determines whether a tax is primarily direct or primarily indirect. This is a function of the relative elasticity of the supply and demand of the goods or services being taxed. Under this definition, even income taxes may be indirect.
Features of Indirect Tax:

Indirect taxation is policy often used to generate tax revenue. Indirect tax…...

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