Question : Which one of the following is a direct tax?
Option 1: Sales tax
Option 2: Excise Duty
Option 3: Wealth tax
Option 4: Entertainment tax
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Correct Answer: Wealth tax
Solution : The correct answer is a Wealth tax .
Wealth tax is a type of direct tax. Indirect taxes include sales tax, excise tax, and entertainment tax. Direct taxes are levied on the earnings or assets of people and corporations. Indirect taxes are charged on both commodities and services. Wealth tax is a direct tax since it is levied on people's and corporations' assets.
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