State, with reasons, whether Goods and Services Tax (GST) is a Direct Tax or an Indirect Tax.

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Q. State, with reasons, whether Goods and Services Tax (GST) is a Direct Tax or an Indirect Tax.

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GST is levied on the supply of goods and services. A registered seller collects GST from the buyer at the time of sale and deposits it with the Government, but the seller does not bear the tax personally — it is built into the price the buyer pays. This ability to shift the burden onto someone else (the final consumer) is the defining feature of an Indirect Tax, which is why GST is classified as an Indirect Tax, unlike Income Tax, which the assessee pays out of their own income and cannot pass on to anyone else.

✓Final answer

GST is an Indirect Tax — the seller merely collects and remits it, while its actual burden is borne by the final consumer.

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Q.State, with reasons, whether Goods and Services Tax (GST) is a Direct Tax or an Indirect Tax.

Concept understanding — History and Structure of Income Tax in India

Q.State, with reasons, whether Goods and Services Tax (GST) is a Direct Tax or an Indirect Tax.

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