Description

Central Excise is an indirect tax that brings in about 20% of all the money the Central Government gets every year. It's important, but not as important as Customs. This tax is supposed to be paid for by the end customer, and it is. But the money goes to the Central Government before the sales. This tax has a "multiplier effect" that keeps bringing in more and more tax money, and not just for the Central Government through Central Excise. When you add up the taxes that have already been paid on the prices of raw materials, intermediates, and parts, the Central Government gets more tax money. People often call this "multiplier effect" a "cascade" or "snowball" effect that taxes the final consumer.