What's the difference between direct and indirect taxation

Direct taxes are paid to the government straight from the individual or group taxpayer. E.g income tax (comes straight from the individuals' income) or corporation tax (comes straight from the firm).

Indirect taxes are taxes on goods and services, which can then be passed onto the consumer by the producer - although this doesn't always happen. E.g VAT.

CM

Related Economics GCSE answers

All answers ▸

What is a general equilibrium in a market?


Name four changes that would cause an increase in an individual consumer's demand for a good or service.


How does the exchange rate mechanism affect aggregate demand in the UK?


What factors can shift the demand curve in a market?