Tax

Tax:- Tax is money that people have to pay to the government. The Govt. uses the money to pay for things. For example taxes are used to pay people who work for Govt. such as military and police, provide services such as education, health care and to maintain or build thing like road, bridge etc.

Types of Taxes:-

There are two types of taxes in India:-

1. Direct Taxes:- These are the taxes that are directly paid to the govt. by taxpayer. This type of tax can't be shifted by the tax payer to any other person. For example:- Income Tax, Wealth Tax.

2. Indirect Tax:- These taxes resulted from manufacturing or sales of good and services. This type of tax can be easily shifted to others. For example:- Service Tax, VAT etc.

                                                                                                            In another word, The Taxes in which the burden is passed on to a third party are called Indirect Taxes.

Excise Service Tax:- The excise service tax is an indirect tax collected from the manufacture who produces the product. It is based on the quantity not on the value of product released.

                                                                                                                                        It is a type of tax charged on goods produced within the country. It is a tax on the production or sale of a good. This tax is also know as central value added tax.

Custom Duty:- A custom duty is a tariff or tax charged on the goods when they are transported across the international borders. It main aims to protect each country's economy, jobs, environment etc.

Service Tax:- Service Tax is a tax levied by the Govt. on the service providers on the certain service transactions but it is actually paid by the customers.

Income Tax:- Income Tax is a tax levied and collected by the Government on income of a person. This tax is calculated as per the total income of a person and paid directly to Govt.

                                                                                                                            This tax is paid by single personal.

VAT(Value Added Tax):- Value Added Tax is a tax levied on sales of goods and services. It is a like a sales tax. This tax is paid every time when goods are sold.

                                                                                                VAT is a multi-Stage Tax. This tax is collected each stage of production. The burden of tax falls on the final customer.