Which among the following is / are correct statements with respect to the Sales Tax and Excise duty in India?
1. Excise duty on alcohol and alcoholic preparations are collected by the State Governments
2. Excise duty on narcotic substances is collected by Central Government
3. While Sales Tax is a direct tax, Excise duty is an indirect tax
Select the correct option from the codes given below:
Excise duty is a tax on manufacture or production of goods. Excise duty on alcohol, alcoholic preparations, and narcotic substances is collected by the State Government and is called “State Excise” duty. The Excise duty on rest of goods is called “Central Excise” duty and is collected in terms of Section 3 of the Central Excise Act, 1944. Sales Tax is different from the Excise duty as former is a tax on the act of sale while the latter is a tax on the act of manufacture or production of goods.
This question is a part of GKToday's Integrated IAS General Studies Module