Multiple choice

Which of the following is not a direct tax?

  1. Estate tax

  2. Sales tax

  3. Corporation tax

  4. None of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Direct taxes are paid directly to the government by the taxpayer, like income tax, corporation tax, and estate tax. Sales tax is an indirect tax because it is collected by intermediaries (retailers) from consumers and then passed to the government - the burden can be shifted. Estate tax, corporation tax, and wealth tax are direct taxes.

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