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Cess

About Cess

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What is Cess

A cess is a form of tax levied by the government on tax with specific purposes till the time the government gets enough money for that purpose. Different from the usual taxes and duties like excise and personal income tax, a cess is imposed as an additional tax besides the existing tax (tax on tax). For example, the Swachh Bharat cess is levied by the government for cleanliness activities that it is undertaking across India.
 
A cess, generally paid by everyday public, is added to their basic tax liability paid as part of total tax paid.
 
Difference between tax and cess
 
A cess is different from taxes as it is imposed as an additional tax besides the existing tax (tax on tax). Another difference lies in the way the revenue recovered from cess is maintained. While revenue from taxes like income tax is kept in the Consolidated Fund of India (CFI) and the government can use it for any purposes it deems fit, the revenue coming from cess is first credited to the Consolidated Fund, and the government may then, after due appropriation from Parliament, utilise it for the specified purpose.
 
Another major difference between central taxes and cess is that the proceeds of a cess may or may not be shared with the state governments, while that of taxes have to be shared.
 
Various types of cesses levied by the government
 
The government levies different cesses on services it provides to the public. Some of them are as follows:
 
Education cess: Collected by the government to provide the mandatory free standard primary education to all citizens.
 
Health cess: Proposed in 2018 by former finance minister Arun Jaitley to meet the health requirements of below-poverty-line families.  
 
Road cess or fuel cess: For maintenance of roads and infrastructure.
 
Clean energy cess: Introduced in 2010, it is a carbon tax on the production and import of coal, lignite and peat, operating on the “polluter pays” principle.
 
Krishi Kalyan cess: It was introduced in 2016 to provide additional support to farmers for agricultural activities.
 
Swachh Bharat cess: Introduced in 2014 with the objective of delivering a clean India, it is levied at 0.5 per cent on all taxable services to fund Swachh Bharat initiatives.
 

Latest Updates on Cess

There has been a rise of 133 per cent in collection of major cess and surcharges levied by the Centre during the five year period between 2017-18 and 2022-23, as it went up to Rs 5,10,549 crore

Updated On: 07 Mar 2023 | 9:40 PM IST

CBDT tells I-T officials to nudge entities; move could help garner over Rs 5,000 cr

Updated On: 24 Jan 2023 | 11:48 PM IST

Experts say finance commission needs to provide clarity on whether cess should be shared with states

Updated On: 29 Dec 2022 | 11:16 PM IST

States have been concerned about increasing cases of Centre imposing cesses for garnering additional revenue

Updated On: 16 Dec 2022 | 6:25 PM IST

I suggest you claim refund of CVD, SAD and cess paid towards regularisation of the default under advance authorisation

Updated On: 11 Jul 2022 | 11:25 PM IST

The export tax on fuels and cess on domestic crude oil production are likely to add to the climate of policy uncertainty in the energy sector

Updated On: 04 Jul 2022 | 6:12 AM IST

The metro cess is intended to fund transport infrastrucuture projects in these cities

Updated On: 01 Apr 2022 | 6:40 PM IST

Govt takes its cut from the profit you earned in the markets in form of taxes. But did you know that the government also charges tax on tax? They are called cess and surcharge. Find out about them

Updated On: 27 Jan 2022 | 8:45 AM IST

Move might impact farmers' realisation when kharif harvest is on, say industry players

Updated On: 14 Oct 2021 | 2:16 AM IST

Liquor prices in Uttar Pradesh have increased after the state government imposed a 'corona cess' from Tuesday

Updated On: 04 May 2021 | 12:58 PM IST

The share of cesses and surcharges in the gross tax revenue of the Centre has nearly doubled to 19.9 per cent in 2020-21 from 10.4 per cent in 2011-12

Updated On: 02 Mar 2021 | 10:45 PM IST

While the FM has ostensibly got her act right on imposing the levy without punishing the consumer, questions about the share of states, the rate structure and the use of funds remain

Updated On: 10 Feb 2021 | 3:22 PM IST

This should not matter much because wherever AIDC has been imposed, the basic customs duty (BCD) or excise duty has been reduced, and in any case

Updated On: 09 Feb 2021 | 2:02 AM IST

The government has introduced the Agriculture Infrastructure and Development Cess that will be levied on select imported goods and petroleum products

Updated On: 07 Feb 2021 | 11:57 PM IST

Cess might not pinch the pocket much as it could be offset by cut in customs duty

Updated On: 01 Feb 2021 | 10:20 PM IST

Experts say the terms mirror the govt's intentions, priorities and policies and provide a hint of financial resources among various sectors

Updated On: 31 Jan 2021 | 7:57 PM IST

CM Amarinder Singh sets up three-member panel of senior officers to assess losses from closure of liquor vends because of lockdown

Updated On: 13 May 2020 | 8:55 PM IST

Govt has imposed two new cesses, one related to farm and another for infrastructure

Updated On: 05 Mar 2016 | 2:50 PM IST