Answer / Sunil Kumar Rastogi

Direct taxes are taxes that are paid directly by the taxpayer to the government, such as income tax and corporate tax. For example, an individual paying income tax based on their earnings is paying a direct tax. Indirect taxes, on the other hand, are levied on the purchase or consumption of goods and services, such as sales tax (VAT) and customs duty. For instance, when you buy a product, you pay a price that includes the cost of the item plus any applicable indirect taxes.

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