Centre Proposes New Excise Law, Ease Of Doing Business In Focus

Centre Proposes New Excise Law, Ease Of Doing Business In Focus

11-06-2024

The Central Board of Indirect Taxes & Customs has invited suggestions on the draft ‘Central Excise Bill, 2024’, which aims to enact a comprehensive modern central excise law with an emphasis on promoting ease of doing business and repealing old and redundant provisions.

The Draft Central Excise Bill, 2024:

  1. The CBIC has invited suggestions from stakeholders on the draft Central Excise Bill, 2024.
  2. The bill aims to replace the Central Excise Act of 1944 after its implementation.
  3. The main aim of this bill is to remove outdated and redundant provisions following the introduction of the Goods and Services Tax (GST).
  4. This Bill addresses the long-standing demand from industry players to align excise duty provisions with GST legislation.

About Central Board of Indirect Taxes and Customs (CBIC):

  1. The Central Board of Indirect Taxes and Customs (CBIC), formerly known as the Central Board of Excise and Customs, is an Indian government agency that administers indirect tax-related issues.
  2. It is a part of the Department of Revenue under the Ministry of Finance.

CBIC's Functions and Responsibilities:

  1. Formulates policies concerning the levy and collection of Customs, Central Excise duties, Central Goods & Services Tax (CGST), and Integrated Goods & Services Tax (IGST).
  2. Prevents smuggling and administers matters related to Customs, Central Excise, CGST, IGST, and Narcotics.
  3. Acts as the administrative authority for subordinate organizations like Custom Houses, Central Excise, and Central GST Commissionerates.
  4. Ensures the administration of taxes on foreign and inland travel as per the law.
  5. Collects customs duty at international airports, seaports, Custom Houses, international cargo stations, inland container depots, land customs stations, special economic zones, and container freight stations.

What is Excise Duty?

  1. Excise duty is a form of indirect tax levied on goods manufactured within the country.
  2. It is imposed on the production or sale of specific goods and is typically paid by the manufacturer or producer.
  3. The end consumer indirectly bears the burden of this tax through increased product prices.
  4. In India, excise duty was previously levied on a wide range of goods under the Central Excise Act, 1944, and Central Excise Tariff Act, 1985.
  5. However, with the introduction of the Goods and Services Tax (GST) in 2017, most excise duties were subsumed into GST.

Currently, excise duty is primarily applicable to a few specific goods, including:

  1. Petroleum products: Such as petrol, diesel, and kerosene.
  2. Alcohol and alcoholic beverages: Including spirits, beer, and wine.
  3. Tobacco products: Including cigarettes, cigars, and chewing tobacco.

Key points to note:

  1. Indirect tax: Excise duty is an indirect tax, meaning it is not directly paid by the consumer but is collected by the manufacturer and passed on to the consumer.
  2. Levied on domestic goods: It is imposed on goods manufactured within the country, distinguishing it from customs duty, which is levied on imported goods.
  3. Purpose: The revenue generated from excise duty is a significant source of income for the government and is used to fund various public services and development projects.

 

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