Chartered Accountant (CA) Question:
Explain What is the incidence of tax?
Answer:
Tax incidence can be divided into-
1. Formal incidence: the party liable to the tax
2. Informal incidence: party, who actually pays the tax
The tax incidence is decided by the elasticity of demand and supply for a good or service.
1. Formal incidence: the party liable to the tax
2. Informal incidence: party, who actually pays the tax
The tax incidence is decided by the elasticity of demand and supply for a good or service.
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