Image credit sofiaecho.com

Image credit sofiaecho.com

ZIMSEC O Level Commerce Notes: Excise Duty

Why excise duty is paid?

  • Excise duty is taxed on certain specified home produced goods for example tobacco meant for consumption in the home market in order to:
  • Raise revenue for the government.
  • Discourage consumption of dangerous products.
  • Reduce domestic demand.
  • Release more goods for export.

Methods of calculating duty.

  • Ad valorem duty:
  • This is calculated based on the value of imported goods.
  • For example 75% on luxury goods.
  • Specific duty
  • This calculation is based on quantities or volume of imported goods e.g. 25% per kg of imported material.

To access more topics go to the Commerce Notes page.

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