Public Revenue — Important Questions

Taxes, Commercial revenues, Administrative revenues, Gifts and grants

All these are legitimate sources of public revenue except private company profits, which belong to private entities, not the government.

True

A tax is indeed a compulsory payment imposed by the government. Citizens cannot refuse to pay taxes, and non-payment leads to legal action.

Direct tax

Income tax is a direct tax because it is paid by the same person on whom it is imposed and cannot be shifted to others.

Indirect taxes

Indirect taxes like excise duty and sales tax can be shifted from producers to consumers through higher prices, while direct taxes cannot be shifted.