ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -An excise tax is known as a “hidden tax, ” because it’s indirectly paid by consumers. The price of gas is one example; excise taxes are paid by the manufacturer, but that cost is bundled into the amount drivers are charged at the gasoline pump.

Detailed explanation-2: -Ad Valorem Tax – refers to the excise tax which is based on selling price or other specified value of the goods/articles.

Detailed explanation-3: -Today, excise duty applies only on petroleum and liquor. Excise duty was levied on manufactured goods and levied at the time of removal of goods, while GST is levied on the supply of goods and services.

Detailed explanation-4: -Excise duty is an indirect tax which has been subsumed by the Goods and Services Tax or GST. However, there are certain items on which excise duty is still charged. For example, alcohol, tobacco, and fuel.

Detailed explanation-5: -Meaning of specific tax in English. a tax that is given as a fixed rate for each unit of a good or service, rather than based on its value: They agreed to a new specific tax on petroleum products. Imported breakfast cereals in smaller packages are subject to a specific tax rate of 12.6 cents per kilogram.