Answer to Question #314932 in Microeconomics for Souljaboy

Question

Since all taxation transfers income from the population to the state, it does not matter very much if this transfer is through direct taxes on incomes or indirectly buy taxes on various goods and services.Discuss

Answer 1

The two main types of taxes are direct and indirect taxes. Direct taxes are filed and paid by an individual directly to the government. Direct taxes are imposed on people within certain income brackets. Secondly, indirect taxes are taxes transferable to another entity. It cannot be invaded since it's imposed automatically on goods and services. These taxations are the mechanisms through which the government earns its revenue. Both direct and indirect taxes involve money circulation from the public to government accounts. The money is then calculated as total revenue thereafter consolidated for budgeting by the state.