Direct taxes are levied on individuals or entities directly by the government. In contrast, Indirect taxes are those collected by an intermediary (e.g. marketplaces, manufacturers, platform owners, vendors) from the end consumer. In other words, the direct tax burden falls directly on the taxpayer, whereas indirect taxes are paid by consumers indirectly through the goods and services they purchase.
- A Comparison of These Two Tax Systems
- Incidence of collection
- Source or destination based
- Regressive tax
- Transactional nature
- Summary of the Major Differences Between Direct and Indirect Tax Systems
- What are the recent trends in indirect taxation?
- Digitization of Indirect Taxes
- E-invoicing
- Real-time Reporting
- Increased Use of Automation
- How can Fonoa help?
Source: Fonoa
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