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What is cess ??

Updated: Nov 13, 2020

The term Cess is short form of “assess”.


Cess is a tax applied over the base tax of taxpayers that’s why it is called ‘tax over tax’.


When a state or central government wants to raise funds a cess can be imposed.


The government impose cess to generate funds for purposes like disaster reliefs, medical emergencies, road/ bridge maintenance, cleaning rivers, etc. and can be imposed on only a specific area/ state.


The government had already levied education cess, health cess, and sanitation cess in different states.


The collected funds by imposing cess has to be used for that exact purpose for it was collected.


If the collected fund is not spent then they’re carried forward to next year and never be used for purposes other than it meant for.


Unlike other taxes process of imposing/ modifying/ abolishing cess is simpler.


Currently, there are 6 cesses continued to be levied in India;


1. Primary Education Cess

2. Secondary Education Cess

3. Cess on Crude Petroleum Oil

4. Road Cess

5. NCCD on tobacco and tobacco products

6. Education cess on imported goods

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