Excise taxes are taxes required on specific goods or services like fuel, tobacco, and alcohol. Excise taxes are primarily taxes that must be paid by businesses, usually increasing prices for consumers indirectly.
What is the purpose of excise duty?
An excise or excise tax (sometimes called an excise duty) is a type of tax charged on goods produced within the country (as opposed to customs duties, charged on goods from outside the country). It is a tax on the production or sale of a good. This tax is now known as the Central Value Added Tax (CENVAT).
What are the examples of excise duty?
Typical examples of excise duties are taxes on gasoline and other fuels and taxes on tobacco and alcohol (sometimes referred to as sin tax).
What is excise and customs duty?
Excise duty refers to the taxes levied on the manufacture of goods within the country, as opposed to custom duty that is levied on goods coming from outside the country. … The Central Board of Excise and Customs (CBEC) is responsible for collecting excise duty.
What is basic excise duty?
Basic excise duty is also known as the Central Value Added Tax (CENVAT). This category of excise duty was levied on goods that were classified under the first schedule of the Central Excise Tariff Act, 1985. … This duty applied on all goods except salt.
How does excise duty work?
An excise duty is a type of indirect tax that is levied on the sales of particular goods. This tax is not paid directly by the customer but is passed on to the consumer by a merchant or producer of goods as a part of the price of the product.
What is difference between income tax and excise duty?
Though referred to as a tax, excise is specifically a duty; tax is technically a levy on an individual (or more accurately, the assessment of tax on the self basis), while duty is a levy on particular goods.
What are excise goods?
Excise goods are goods on which UK excise duty is chargeable on importation or production in the UK and will be payable at the time the goods are released for consumption in the UK. … Excise goods include: beer, wine, spirits and other alcohol products. cigarettes and other tobacco products.
Who is liable to pay excise?
The liability to pay tax excise duty is always on the manufacturer or producer of goods. There are three types of parties who can be considered as manufacturers: Those who personally manufacture the goods in question. Those who get the goods manufactured by employing hired labour.
What are the different types of customs duty?
Types of custom duties
- Basic Customs Duty (BCD)
- Countervailing Duty (CVD)
- Additional Customs Duty or Special CVD.
- Protective Duty,
- Anti-dumping Duty.
- Education Cess on Custom Duty.
What is customs duty with examples?
Customs duty refers to the tax imposed on goods when they are transported across international borders. In simple terms, it is the tax that is levied on import and export of goods. The government uses this duty to raise its revenues, safeguard domestic industries, and regulate movement of goods.
How is customs duty calculated?
Custom Duty Rates
- LC: Landing charge – 1% CIF.
- CVD: Countervailing Duty – 0%, 6% or 12% (CIFD + LC)
- CEX: Education and Higher Education Cess – 3% CVD.
- CESS: Education + Higher Education – 3% (Duty + CEX (Education and Higher Education Cess) + CVD)
- Additional CVD: 4% (CIFD + LC + CVD + CESS + CEX)