Is Payment of indirect taxes by a firm included/excluded in national income?
Is Payment of indirect taxes by a firm included/excluded in national income?
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No,
It will not be included in the national income as it is a transfer payment and occuring without any corresponding value addition.
Explanation:-
The payment of indirect taxes by a firm to the government is just a transfer payment. Because the government does not guarantee any factor services against it.
It does not add to the current flow of goods and services in the economy.
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