Hidden Taxes

AAA

DEFINITION of 'Hidden Taxes'

Taxes that are indirectly assessed upon consumer goods without the consumer's knowledge. Hidden taxes are levied upon the goods at some point during the production process and therefore raise the cost of the goods sold. However, this tax is never revealed directly to the consumer, who simply pays a higher price for the good, not knowing that part of that price is due to this tax.

INVESTOPEDIA EXPLAINS 'Hidden Taxes'

Some ad valorem taxes are an example of a hidden tax, as are taxes that are imposed at the wholesale level. Most consumers are aware that there is a tax on retail goods (sales tax), but this is by no means the only tax levied on consumer goods. Hidden taxes are almost invariably passed on to the consumer.

RELATED TERMS
  1. Stealth Taxes

    A type of levy that governments use to increase their revenues ...
  2. Ad Valorem Tax

    A tax based on the assessed value of real estate or personal ...
  3. Taxes

    An involuntary fee levied on corporations or individuals that ...
  4. Sales Tax

    A tax imposed by the government at the point of sale on retail ...
  5. Tax Rate

    The percentage at which an individual or corporation is taxed. ...
  6. Value-Added Tax - VAT

    A type of consumption tax that is placed on a product whenever ...
Related Articles
  1. Municipal Bond Tips For The Series 7 ...
    Insurance

    Municipal Bond Tips For The Series 7 ...

  2. Don't Put Off Your Year-End Tax Plan
    Taxes

    Don't Put Off Your Year-End Tax Plan

  3. NAFTA's Winners And Losers
    Economics

    NAFTA's Winners And Losers

  4. 10 Reasons Why Moving Might Not Make ...
    Insurance

    10 Reasons Why Moving Might Not Make ...

comments powered by Disqus
Hot Definitions
  1. Last In, First Out - LIFO

    An asset-management and valuation method that assumes that assets produced or acquired last are the ones that are used, sold ...
  2. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  3. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  4. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  5. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  6. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
Trading Center