What term describes a levy that is paid from income, such as personal income tax and corporate tax?

What term describes a levy that is paid from income, such as personal income tax and corporate tax?

• A. Balance of Payments
• B. Exchange rate
• C. Direct tax
• D. Economic growth

Answer: (C)

Direct taxes are levies paid directly to the government based on income or profits, such as personal income tax and corporate tax. This type of tax is tied to the ability to pay and collected from individuals or businesses, rather than included in the price of goods and services. The other terms refer to different ideas: the Balance of Payments tracks a country’s international transactions, the exchange rate is the value of one currency in terms of another, and economic growth is the rise in a country’s overall output. So the described levy is a direct tax.

Direct taxes are levies paid directly to the government based on income or profits, such as personal income tax and corporate tax. This type of tax is tied to the ability to pay and collected from individuals or businesses, rather than included in the price of goods and services. The other terms refer to different ideas: the Balance of Payments tracks a country’s international transactions, the exchange rate is the value of one currency in terms of another, and economic growth is the rise in a country’s overall output. So the described levy is a direct tax.