What is the term for taxes that are paid through an intermediary to the tax authorities?

The term for taxes that are paid through an intermediary to the tax authorities is known as indirect taxation. This type of taxation is collected by an intermediary (such as a retailer or service provider) from the consumer at the point of purchase, and then the intermediary forwards this tax to the government. One of the main characteristics of indirect taxes is that they are not directly paid by the individual taxpayer to the government; instead, they are included in the price of goods and services.

Common examples of indirect taxes include sales tax, excise duties, and Value-Added Tax (VAT). The consumer often does not see this tax as a separate line item and may be unaware of how much tax they are actually paying because it is embedded in the cost of the product or service they are buying.

In contrast, direct taxation involves taxes that are paid directly by individuals or organizations to the government, such as income tax or corporation tax, where the taxpayer is responsible for the payment without any intermediary. Progressive taxation refers to a system where the tax rate increases as the taxable amount increases, typically focusing on income tax systems rather than the intermediary aspect found in indirect taxation. Value-added tax specifically refers to a type of indirect tax, but the broader category of taxes paid through intermediaries