Example of Indirect Tax

Indirect taxes are those which are levied or imposed on goods or services and not on the income of the individual and therefore they affect the individuals indirectly as prices of goods and services which the consumer use rise when they are levied. Given below are some of the examples of indirect tax –

  1. Excise Duties
  2. Sales Tax
  3. Service Tax
  4. Custom Duties
  5. Value added Tax (VAT)

As one can infer from above examples raising any of the above will not directly affect the person but rather it will affect them indirectly and hence it is used by governments all over the world along with direct taxes in order to meet its budgeted revenues.

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