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Questions and Answers
What is the difference between a direct and an indirect tax?
What is the difference between a direct and an indirect tax?
- Direct tax is a fixed amount while indirect tax is determined by the value of the property being taxed
- Direct tax is demanded from persons who are intended or bound by law to pay the tax while indirect tax can be shifted to another (correct)
- Direct tax is imposed on property while indirect tax is imposed on individuals
- Direct tax is paid by someone other than the taxpayer while indirect tax is paid by the taxpayer
What is the difference between a specific and an ad valorem tax?
What is the difference between a specific and an ad valorem tax?
- Specific tax is a percentage of the value of the property being taxed while ad valorem tax is a fixed amount
- Specific tax is a fixed amount while ad valorem tax is imposed based on a physical unit of measurement (correct)
- Specific tax is imposed on property while ad valorem tax is imposed on individuals
- Specific tax is determined by an independent appraiser while ad valorem tax is not
What is the difference between a general/fiscal/revenue tax and a special/regulatory tax?
What is the difference between a general/fiscal/revenue tax and a special/regulatory tax?
- General taxes are indirect while special taxes are direct
- General taxes have a specific purpose while special taxes are raised for whatever need may arise (correct)
- General taxes are imposed by municipal governments while special taxes are imposed by the national government
- General taxes are graduated while special taxes are not
