Canons of Taxation

Canons of Taxation . Canon of Ability . Canon of Certainty . Canon of Convenience . Canon of Economy - - Fiscal Economics only those taxes whose collection costs are very less and cheap . . . . Direct Tax and Indirect Tax Direct Tax A direct tax is referred to as a tax levied on person’s income and wealth and is paid directly to the government; the burden of such tax cannot be shifted. The tax is progressive in nature. It is levied according to the paying capacity of the person, i.e. the tax is collected more from the rich and less from the poor people. The plans and policies of Direct Taxes are being recommended by the Central Board of Direct Taxes (CBDT) which is under the Ministry of Finance, Government of India.