A sales tax is a type of
A) aggressive B) regressive C) both A & B D) None of the above
Answers
Answer:
Hey mate, here is your answer.
The correct answer is {C} both A & B.
Explanation:
Sales Tax in India
Sales tax is an indirect tax which is paid to a regulating/ governing body for the sale the sale of goods and services. Sales tax is generally charged in percentage (of the value of the product) at the time of purchase or exchange of goods. The amount/ rate of income tax depend upon the ruling government guidelines and individual policies. Sales tax in general terms means the extra money one needs to pay for purchasing goods and services.
Types of sales tax:
The governments usually follow their own governing principles for categorizing the sales tax; however in most of the countries, there are some universal sales taxes too. Types of sales taxes are listed below:
Central Sales Tax Act, 1956:
The taxation laws, rules/ regulations of the sales tax are contained in Central Sales Tax Act which governs taxation of sales in India. According to this act, the central government can collect sales tax which has been paid in the state since the sale has been made in state itself.
State government taxes:
To meet financial requirements, the states need to levy a separate tax on sales on the regulations of the ruling state government which vary from state to state. The VAT (Value Added Tax) levied by states is a huge source of income to state governments. And since there is parity in rates, the price of products varies from state to state.
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