Indirect Tax

Indirect Tax refers to taxes that are levied on goods and services rather than on income or wealth. Unlike direct taxes, where the taxpayer bears the burden, indirect taxes are typically passed on to the end consumer by the producer or service provider. The consumer pays the tax when purchasing goods or services, but the responsibility for collecting and remitting the tax rests with businesses.

Key Areas

• Value-Added Tax (VAT)
  Description: VAT is a consumption tax placed on a product whenever value is added at each stage of the supply chain, from production to the point of sale.
  Applicability: Levied at every step of production and distribution, but ultimately paid by the final consumer.
  


• Sales Tax:
  Description: A sales tax is a tax on the sale of goods and services, usually calculated as a percentage of the selling price.
  Applicability: Typically imposed at the point of sale and paid by the consumer, with businesses collecting and remitting the tax to the government.


• Excise Duty
  Description: Excise duties are taxes imposed on specific goods and services, usually on products considered non-essential or harmful.
  Applicability: Imposed on goods such as tobacco, alcohol, gasoline, and luxury items.


• Customs Duties
  Description: Customs duties are taxes imposed on goods imported into a country.
  Applicability: These are typically paid by importers, who may pass the cost on to consumers in the form of higher prices.


• Service Tax
  Description: Service tax is levied on certain services, such as hospitality, telecommunications, and financial services.
  Applicability: Businesses providing taxable services collect the service tax from the consumer and remit it to the government.


• Carbon Tax
  Description: A carbon tax is a tax imposed on the carbon content of fuels, aimed at reducing greenhouse gas emissions.
  Applicability: : It is paid by producers or distributors of fossil fuels, but the cost is often passed on to consumers in the form of higher prices for energy, gasoline, and related products.


• Toll Tax
  Description: Toll taxes are fees levied on the use of certain roads, bridges, or tunnels.
  Applicability: The toll is collected from the user (motorists) for the right to use the infrastructure.