A sales tax is a type of indirect tax.
Indirect taxes are levied on goods and services rather than on individuals or income directly. In the case of a sales tax, it is imposed on the sale of goods and services at the point of purchase. This tax is collected by the seller from the buyer and then paid to the government.
Unlike direct taxes, which are directly paid by individuals or entities to the government (e.g., income tax), indirect taxes like sales tax are passed on to the end consumer as part of the purchase price.
Therefore, a sales tax falls under the category of indirect taxes because it is collected indirectly through the sale of goods and services.
