Question
State two demerits of direct taxes.
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Answer
Demerits of Direct Taxes
(i) Direct taxes are painful to the tax-payers, as they are not transferable.
(ii) There is a great possibility of tax evasion of direct taxes, as people do not show their correct income.
(iii) Direct taxes are levied only on certain group of persons (i.e., the rich) and low income group people are exempted from such taxes.
(i) Direct taxes are painful to the tax-payers, as they are not transferable.
(ii) There is a great possibility of tax evasion of direct taxes, as people do not show their correct income.
(iii) Direct taxes are levied only on certain group of persons (i.e., the rich) and low income group people are exempted from such taxes.
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