Shifting to escape tax
"Shifting of the burden of the tax" happens when the taxpayer transfers to another person the burden of the tax. The taxpayer remains the taxpayer; he still pays it but the economic burden is transferred to another person.
There are three (3) ways of shifting tax burden: [1] forwarding; [2] backwarding; and [3] onwarding.
When the burden of the tax is transferred to the end user, ultimate purchaser or ultimate consumer, there is forward shifting.
When the burden of tax is taken away from the end user by adjusting production or distribution variables, there is backward shifting.
When the tax burden is shifted two or more times either forward or backward, there is onward shifting.
There are three (3) ways of shifting tax burden: [1] forwarding; [2] backwarding; and [3] onwarding.
When the burden of the tax is transferred to the end user, ultimate purchaser or ultimate consumer, there is forward shifting.
When the burden of tax is taken away from the end user by adjusting production or distribution variables, there is backward shifting.
When the tax burden is shifted two or more times either forward or backward, there is onward shifting.
