In taxation theory, what is the name of the tax that is entirely borne by the entity on which it is levied and cannot be shifted to any other person, consumer, or firm?

Introduction / Context:
This question tests understanding of the basic distinction between direct and indirect taxes in public finance. A key issue in taxation is who legally pays the tax and who actually bears the burden. The tax that cannot be shifted and is paid by the same entity on which it is legally imposed is central to the definition of a direct tax, which is widely discussed in economics and competitive exams.

Given Data / Assumptions:

• The tax is levied on a particular entity such as an individual or a firm.
• The entire burden of the tax remains on the same entity.
• The tax cannot be shifted to consumers or any other party through higher prices or other means.
• We need to identify what such a tax is commonly called in economics.

Concept / Approach:
In basic public finance, taxes are classified mainly into direct and indirect taxes. A direct tax is one where the impact and incidence fall on the same person. In other words, the person who is legally responsible for paying the tax also bears the economic burden. Income tax and wealth tax are classic examples. In indirect taxes like goods and services tax, the seller collects the tax but shifts the burden to consumers through higher prices. The question describes a tax that cannot be shifted, which matches the definition of a direct tax.

Step-by-Step Solution:
Step 1: Read the description carefully: the tax is entirely borne by the entity on which it is levied. Step 2: Recall that in direct taxes, the taxpayer and the bearer of the tax burden are the same. Step 3: Recall that in indirect taxes, the seller or intermediary collects the tax but recovers it from consumers, so the burden is shifted. Step 4: Match the description to the correct category of tax: a tax that cannot be shifted corresponds to a direct tax. Step 5: Confirm that no other option matches this description as precisely as direct tax.

Verification / Alternative check:
Take income tax as an example. The law requires the individual or company that earns income to pay tax directly to the government. Even if this cost influences business decisions, there is no legal mechanism by which the company can label the tax separately and bill it directly to another party. By contrast, a consumption tax such as GST is added to the price of goods and services and is clearly passed on to buyers. Thus, income tax is a direct tax and fits the description given in the question.

Why Other Options Are Wrong:
Option B, indirect tax, is designed so that the person who pays the tax to the government (for example, a shopkeeper) recovers it from consumers. Therefore, its burden is shifted. Option C, straight tax, is not a standard technical term in public finance and does not represent a standard category. Option D, advance tax, refers to the timing of payment of income tax and not to whether the tax can be shifted. The only correct concept for a tax whose burden cannot be shifted is a direct tax.

Common Pitfalls:
Students sometimes confuse direct and indirect taxes on the basis of who collects them rather than who finally bears the burden. Another common confusion is to think that if a firm raises prices after a tax, the tax automatically becomes indirect, which is not correct for classification. The classification is based on the general nature of the tax, not individual business responses. Keeping the impact and incidence idea clear helps avoid such confusion.

Final Answer:
A tax that is entirely borne by the entity on which it is levied and cannot be passed on to others is called a Direct tax.