Banking & PSC Exam Question - What is Direct Tax? What are the Advantages and Disadvantages of Direct Tax System in Nepal? Explain

Introduction - Direct Tax System in Nepal

The person tax on the person, the same person directs taxes from their sources. Such tax is collected directly from the tax charged or charged with tax. Direct tax can not be transferred from one person to another, i.e. direct tax on monetary weight and final weight is equal to one person. The same person who has to pay the tax burden and pay tax liability is the same. Such taxes are made of income and property. The person who is more than the limit specified by the income and property law, is the person's contribution. There are instances of income tax, property tax, investment, income tax benefits, tax and etc.

Advantages of Direct Tax System:

• The person is required to pay tax on the basis of his income and property. Due to many income or property, many and small revenues pay less taxes. Direct tax equality is found.
• Taxpayers can easily estimate the amount they pay when they are entitled to timely payment, process or form of payment.
• Depending on the change in person's income and property, easily change the amount of tax returns, there is a flexibility of flexibility.
  The person who is directly paid is to pay for money from his own source, because he is alert to the usefulness of tax.

Disadvantages of Direct Tax System:

• The taxpayer has a mental persecution because taxpayers pay direct tax to their income tax.
• Taxpayers feel inconvenience due to the direct taxes being progressive, i.e. the higher income in income or property.
  Tax payers can increase the tendency due to experience of direct burden.
• Due to making tax collection directly from each taxpayer, tax collection work becomes expensive.
• Only tax is collected from people with income or property than the specified limit, only limited to it.
• The taxpayer is likely to be discouraged on savings operations due to some portion of the income spent on the payment.