Direct Tax
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Income taxes are one of the most common direct taxes. These are paid by people who make money through wages, self employment, interest income, and other sources. In the United States, income taxes are designed to be progressive and therefore they become more expensive as people make more money. The government imposes income taxes at both the state and federal level. -
Sales taxes are another example of a direct tax. This is a tax that retailers charge customers on their purchases. The retailer then sends the collected amount to the government for redistribution. Sales taxes may be imposed at both the state and local level. Some states have sales tax exemptions for food, for example, which means that some people do not pay sales tax on groceries. -
Property taxes are another form of direct taxation. Property taxes are imposed on the value of property owned by individuals and corporations. The government then collects the revenue from these taxes and uses it to pay for local projects and services. Property taxes may be imposed at both the state and local level. Property Tax in Chicago -
Excise taxes are a final example of a direct tax. These are taxes levied on certain goods and services. These include items like liquor, cigarettes, and gasoline, among others. The government will collect this revenue and then use it for public projects and programs. Excise taxes may be imposed at both the state and federal level.
