Taxes are the sum of money that the common man, the public or the governed pays to the government so that it can be used by the government to facilitate things for the people in the state, in laymen’s terms. Basically, there are two “types” of taxes, direct and indirect taxes. The quintessential difference between these two types of taxes is, the fact that whether the burden to pay the tax falls on the same or different persons. What I mean to say is that, for instance, Income Tax being a direct tax implies that the tax would be paid by the same person on whom the burden to pay it falls upon. For instance, I earn income and I pay the income tax on the money I earn myself. But what happens in the case of indirect tax is that, for instance, the shopkeeper has the liability or the burden to pay the taxes in form of, say, GST to central and state govt. (CGST & SGST respectively), but he recovers that bit from the consumers, buyers, and customers. So here, the liability and burden falls on one person but another person actually pays the tax to the government.

Direct taxes include wealth tax, personal income tax, corporate income tax, gift tax, interest tax, prerequisite tax, securities transaction tax, capital gains tax

Income tax

This is levied upon one’s income (whether earned by way of salaries or investments or the properties you own), and this is a progressive taxation system in India, which implies, that as the income increases, the tax payable upon that also increases. There exists different tax slabs for different income groups. Income tax is governed by its act, the IT Act of 1961 that also entails clauses of exemptions or tax benefits, as its called, on certain items like, fixed deposits or life insurance premium.

Capital gains tax

This is basically payable on amounts of money that you receive from an investment, etc., those amounts being capital gains i.e. considerable sums of money.

Securities transaction tax

This is payable in stock market transactions, and is calculated by adding the share price and the tax amount. Every time a securities trader buys or sells any share, during the process, he has to pay a securities transaction tax.

Corporate tax

This is like personal tax for the companies. The tax rates differ for domestic and foreign corporates. Also there are four kinds of corporate tax, minimum alternate tax, fringe benefit tax, dividend distribution tax, banking cash transaction tax.

Indirect taxes

The GST regime has been a historical tax reform. This, if seems an exaggeration, then I would say, at the least, our Indirect taxation system has been made a lot less complex and sorted, since the dawn of the GST era, thanks to the Modi led NDA Govt. at the centre. Now, we don’t encounter a multitude of indirect taxes. Taxes like, Central Excise Law, Service Tax Law, State VATs, Entry Tax, Luxury Taxes, Octroi etc haves been superimposed by the GST.

This includes, service tax, excise duty, sales tax, custom duty, Value Added Tax (VAT) and GST

Excise duty

This duty is to be paid on any good as soon as it is produced by the manufacturer, the incidence of which he passes on to the customers, making this duty an indirect tax. This duty is applied to goods such as, petroleum crude, high-speed diesel, motor spirit (commonly known as petrol), natural gas, aviation turbine fuel, tobacco and tobacco products.

GST (Goods and Services Tax)

Excise duty, service tax have been subsumed in CGST, while VAT, luxury tax, purchase tax, entry tax, in SGST, while CST in IGST (Interstate GST). On the other hand, custom duty, exports duty, stamp duty, electricity duty haven’t been subsumed in GST. The subsumption should result in a free flow of tax credit in intra and inter-State levels. GST has been introduced to remove the effect of Tax Cascading.

Custom duty

When we buy things imported from abroad, we are charged a customs duty. It doesn’t matter whether the good travels via air, sea, or land. Custom duty is what makes the imported items costlier for us!

Sources:

https://www.indiatoday.in/information/story/list-of-taxes-that-every-indian-pays-from-gst-to-income-tax-1430531-2019-01-14

https://taxmantra.com/taxes-to-be-subsumed-in-gst/

https://www.policybazaar.com/tax/