ABSTRACT
I have discussed in the previous chapter that direct tax is based on the equity or income of corporate or individual entities. In the case of indirect taxation, however, taxes are levied on the taxpayer’s consumption activities and the value of those taxes is added to the price of the product that is being sold or of the service being provided. In indirect taxation, the actual taxpayer, that is, the person who bears the financial burden of the tax, does not pay the tax directly to the public treasury.2 Since this type
of tax is levied on the operations that are carried out by business owners or service providers, they are the ones who are liable for payment to the state. Considering the types of charges, there are three kinds of indirect taxes: cumulative indirect taxes, indirect taxes on value-added, and indirect taxes on sales (retail and excise taxes).
