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DIRECT TAXES
A direct tax is one where the impact and incidence of the Tax is on the same person e.g. Income Tax, death or estate duty, corporation taxes and capital gains taxes. It can also be defined as the tax paid by the person on whom it is legally imposed.
This means on whom the tax is imposed.
This means who has to bear the burden of the tax, i.e. who finally pays the tax.
a) In 1948, the money GNP was $520 billion and the price index was 120. In order to make the 1948 GNP comparable with the base year, the 1948 GNP must be adjusted to:
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