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Difference Between Excise Duty and Custom Duty

Excise Duty vs  Custom Duty

The government imposes duties as a means of revenue collection for undertaking various social and development works. It is through the taxes and duties that the government is able to run the state.

Duty, which is an indirect tax, can be called a tax levy on goods which are imported from another nation and also manufactured in the country. It can also be noted that duty is only levied on produce and not on individuals. The duty that is levied for goods manufactured inside the state can be called as excise duty. And the duty that is levied on goods imported from a foreign country is the customs duty.

Excise duty is imposed along with VAT and sales tax. When looking at the price of goods, excise duty forms its major portion. Excise duty is valued ad valoreum, which means that the duty is calculated taking into account the number of goods or the volume of the goods.

The customs duty of any goods is valued by its assessable value. It is the World Customs Organisation that has developed the assessable value. Each product has been given a value or code, which is four to ten digits. There is a general tendency in all countries to levy high customs duties on liquor and tobacco.

Each country has its own rules and regulations and ways of imposing and collecting excise and customs duty. Excise and customs duties may differ from one country to another.

When talking of both duties, most of the administrative procedures, valuation, confiscation, refund, appeal and settlement are the same in both excise and customs duty.

Summary

1. The duty that is levied for goods manufactured inside the state is called excise duty. The duty that is levied on goods imported from a foreign country is the customs duty.
2. Excise duty is imposed along with VAT and sales tax. When looking at the price of goods, excise duty forms its major portion.
3. Excise duty is valued ad valoreum, which means that the duty is calculated taking into account the number of goods or the volume of the goods.
4. The customs duty of any goods is valued by its assessable value. Each product has been given a value or code, which is four to ten digits.
5. When talking of both duties, most of the administrative procedures, valuation, confiscation, refund, appeal and settlement are the same in both excise and customs duty.


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