GENERAL KNOWLEDGE

Detailed explanation-1: -An education cess is an additional levy that is applied on the basic tax liability by the Government to generate additional revenue to fund primary, secondary and higher education. Apart from individuals, even corporations are required to pay this cess every year at rates determined during the annual budgets.

Detailed explanation-2: -While the rate for education cess is 2 percent of the payable tax, the Secondary and Higher Education cess is 1 percent of the tax amount. So, totally, the rate of education cess is 3 percent of the amount of tax.

Detailed explanation-3: -The rate at which education cess is calculated is actually a combination of the two types of cess applied on the taxable income. For the education cess the rate is 2% of the tax payable and for the Secondary and Higher Education Cess the rate is 1% of the tax payable.

Detailed explanation-4: -The Government levies cess on every taxpayer. The Government levies a surcharge on those individuals who have a higher taxable income.