- Direct Tax: This tax is imposed directly on taxpayers and is required to be paid to the government. It cannot be passed or assigned by an individual to another person. For example, Income tax, is the tax applicable on the income earned by an individual or taxpayer, or corporate tax, is the tax applicable on the profits earned by companies from their businesses.
It is levied based on the government’s Income tax slabs, which are revised from time to time. Not all individuals shall pay the same amount of tax; the general rule is – the higher your income, the higher amount of tax you will have to pay