Value Added Tax (VAT) is not classified as a direct tax; rather, it is considered an indirect tax.
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Indirect Tax: VAT is a consumption tax levied on the value added to goods and services at each stage of production or distribution. Ultimately, the consumer bears the cost of this tax, but it is collected and remitted to the government by businesses.
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Direct Tax: On the other hand, direct taxes are taxes that are directly paid to the government by individuals or organizations. Income tax is a prime example of a direct tax, as it is based on an individual's or entity's earnings.
In summary, VAT is an indirect tax, while income tax is a direct tax.