Distinguish between: Direct tax and Indirect tax.

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Q. Distinguish between: Direct tax and Indirect tax.

Maharashtra MsbshseMaharashtra HSC (MSBSHSE) Board 2020Subjective· 2mImportance★★★★★

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Direct tax: burden cannot be shifted. Indirect tax: burden is shifted to another person.

Basis	Direct tax	Indirect tax
Meaning	Tax whose burden falls on the same person on whom it is levied	Tax levied on one person but whose burden is shifted to another
Impact & incidence	Fall on the same person	Fall on different persons
Shifting of burden	Cannot be shifted	Can be shifted (to the buyer)
Examples	Income tax, wealth tax, corporate tax	GST, customs duty, excise duty

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Same / Similar Concept — real previous-year questions on the same or a closely similar concept, not this exact question.

CBSE 2023Set ANNUAL1 markMCQ
$Q. Find the odd word out: Non-tax revenue:$
(a) Fees
(b) Penalty
(c) Wealth tax
(d) Special levy
›Reveal solutionSolution
The odd word is Wealth tax — it is a form of tax revenue, whereas fees, penalty and special levy are all non-tax sources of public revenue.

Public revenue is broadly divided into tax revenue (compulsory payments with no direct quid pro quo, e.g. income tax, GST, wealth tax) and non-tax revenue (receipts from sources other than taxes):

Fees — charged for a specific government service (e.g. licence fee).

Penalty / fines — payments imposed for breaking a law or rule. …
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CBSE 2022Set ANNUAL1 mark

Q. Complete the correlation. Personal Income tax : ______ :: Goods and service tax (GST) : Indirect tax.

›Reveal solution

The missing term is Direct tax. Personal income tax is a direct tax because its money burden and impact fall on the same person and cannot be shifted to anyone else.

Taxes are divided into two types on the basis of shifting of the burden:

Type	Meaning	Examples
Direct tax	Impact and incidence fall on the same person; burden cannot be shifted	Personal income tax, corporate tax, wealth tax
Indirect tax	Levied on goods and services; burden can be shifted to the final consumer	GST, customs duty, excise duty
…

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Q.Distinguish between:
Direct tax and Indirect tax.

Concept understanding — Public Revenue — Tax and Non-Tax Revenue

Q.Distinguish between: Direct tax and Indirect tax.

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Q.Distinguish between:
Direct tax and Indirect tax.

Unlock everything free for 14 days