In India, goods manufacturers pay an amount for the production, sales and licensing of certain goods to the Central Government. This amount is known as excise duty.
Want to know more about excise duty and related information?
Read the following section, and you will get the answers.
Excise duty is a tax levied on the products manufactured within a country. Retailers or intermediaries collect this indirect tax from customers and pay it to the Central Government.
This amount is payable when the manufacturers remove goods from their production area or warehouse and transfer it for selling. Here, the actual sale of goods or the amount is not considered since tax is applicable on the manufacture of these goods. The Central Board of Excise and Customs (CBEC) administers the whole tax collection process.
Excise duty was previously collected as Additional Excise Duty or Central Excise Duty. However, the Government consolidated several types of excise duty after implementing Goods and Services Tax (GST) during July of 2017. Currently, excise duty is applicable on specific items, including liquor, petroleum, etc.
Now that excise duty meaning is clear to individuals, let us delve into different types of it.
Before GST implementation in India, there were 3 types of excise duty. These are -
As per the law, persons or parties liable to pay excise duty include -
Now that individuals know excise duty definition, types and eligibility, let’s focus on when and how to pay such duty.
Excise duty payment is made at the time of removal of goods. As per the Central Excise (Amendment) Rules, 2002, individuals need to pay such duty on the successive month’s 5th day from the date of removal of goods from factory or warehouses for sale.
If individuals opt for online payment of excise duty, they have to make payment on the following month’s 6th day.
From October 1st 2014, taxpayers need to pay excise duty through Net Banking using the CBES gateway known as Electronic Accounting System in Excise and Service Tax (EASIEST).
Here are the steps for this process -
After successful payment, a challan will be generated featuring the Challan Identification Number (CIN).
At last, verify excise duty payment on the EASIEST website using Challan Status Enquiry.
The Central Government charges excise duty on several products. These are,
Under various sections of the Central Excise Act, the Government imposes penalty charges for evading tax. This penalty charge can range from 25% to 50% of the total excise duty amount.
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Excise Duty |
Custom Duty |
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Applicable on goods that are manufactured within a country |
Applies on goods sold in India but manufactured in another country |
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Manufactures pay excise duty |
Importer pays customs duty |
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Disclaimer: This information is added only for informative purposes and collected from different sources across the Internet. Digit Insurance is not promoting or recommending anything here. Please verify the information before making any decisions.
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