Excise Tax
Excise taxes are imposed on certain goods and services, such as gasoline and alcohol. These taxes are paid directly by businesses. This tax is often passed on to the consumer, who may or may not be aware that they're paying it to the merchant because it's included in the price. This is common in the fuel industry, where companies include excise taxes on the price at the pump that is paid by their customers."}},"@type": "Question","name": "What Is a Federal Excise Tax?","acceptedAnswer": "@type": "Answer","text": "A federal excise tax is charged on certain goods and services by the federal government. It may or may not be included by the merchant into the price. This means that consumers don't pay these taxes directly as they would any other type of tax, such as income taxes. Federal excise taxes are commonly imposed on things like fuel, airline tickets, tobacco, and alcohol.","@type": "Question","name": "How Is an Excise Tax Different From a Sales Tax?","acceptedAnswer": "@type": "Answer","text": "Excise and sales taxes are two very different types of taxes. An excise tax is imposed on very specific goods and is generally the responsibility of the merchant to pay to the government. The merchant, in turn, may or may not pass the tax on to the consumer by adding it into the price. A sales tax, on the other hand, is charged on almost everything and is collected from the consumer by the merchant who passes it on to the government. Rather than being a fixed amount like an excise tax, the sales tax is a percentage of the price of the good or service. So the tax on a $25 sweater would be lower than the sales tax on a $200 television set."]}]}] Investing Stocks Bonds Fixed Income Mutual Funds ETFs Options 401(k) Roth IRA Fundamental Analysis Technical Analysis Markets View All Simulator Login / Portfolio Trade Research My Games Leaderboard Economy Government Policy Monetary Policy Fiscal Policy View All Personal Finance Financial Literacy Retirement Budgeting Saving Taxes Home Ownership View All News Markets Companies Earnings Economy Crypto Personal Finance Government View All Reviews Best Online Brokers Best Life Insurance Companies Best CD Rates Best Savings Accounts Best Personal Loans Best Credit Repair Companies Best Mortgage Rates Best Auto Loan Rates Best Credit Cards View All Academy Investing for Beginners Trading for Beginners Become a Day Trader Technical Analysis All Investing Courses All Trading Courses View All TradeSearchSearchPlease fill out this field.SearchSearchPlease fill out this field.InvestingInvesting Stocks Bonds Fixed Income Mutual Funds ETFs Options 401(k) Roth IRA Fundamental Analysis Technical Analysis Markets View All SimulatorSimulator Login / Portfolio Trade Research My Games Leaderboard EconomyEconomy Government Policy Monetary Policy Fiscal Policy View All Personal FinancePersonal Finance Financial Literacy Retirement Budgeting Saving Taxes Home Ownership View All NewsNews Markets Companies Earnings Economy Crypto Personal Finance Government View All ReviewsReviews Best Online Brokers Best Life Insurance Companies Best CD Rates Best Savings Accounts Best Personal Loans Best Credit Repair Companies Best Mortgage Rates Best Auto Loan Rates Best Credit Cards View All AcademyAcademy Investing for Beginners Trading for Beginners Become a Day Trader Technical Analysis All Investing Courses All Trading Courses View All Financial Terms Newsletter About Us Follow Us Facebook Instagram LinkedIn TikTok Twitter YouTube Table of ContentsExpandTable of ContentsWhat It IsHow It WorksAd Valorem Excise TaxesSpecific Excise TaxesRetirement AccountsExcise Tax FAQsThe Bottom LinePersonal FinanceTaxesExcise Tax: What It Is and How It Works, With ExamplesBy
excise tax
Excise taxes are imposed on certain goods and services, such as gasoline and alcohol. These taxes are paid directly by businesses. This tax is often passed on to the consumer, who may or may not be aware that they're paying it to the merchant because it's included in the price. This is common in the fuel industry, where companies include excise taxes on the price at the pump that is paid by their customers.
A federal excise tax is charged on certain goods and services by the federal government. It may or may not be included by the merchant into the price. This means that consumers don't pay these taxes directly as they would any other type of tax, such as income taxes. Federal excise taxes are commonly imposed on things like fuel, airline tickets, tobacco, and alcohol.
Excise and sales taxes are two very different types of taxes. An excise tax is imposed on very specific goods and is generally the responsibility of the merchant to pay to the government. The merchant, in turn, may or may not pass the tax on to the consumer by adding it into the price. A sales tax, on the other hand, is charged on almost everything and is collected from the consumer by the merchant who passes it on to the government. Rather than being a fixed amount like an excise tax, the sales tax is a percentage of the price of the good or service. So the tax on a $25 sweater would be lower than the sales tax on a $200 television set.
Public Law 117-169, 136 Stat. 1818 (Aug. 16, 2022), commonly known as the Inflation Reduction Act, created a new 1% excise tax on the repurchase of corporate stock by certain publicly traded corporations or their specified affiliates. Find details, including when stock repurchases may prompt the excise tax, in Notice 2023-02.
Effective July 1, 2022, excise taxes are reinstated on certain chemicals and imported chemical substances. The applicable tax rates and related provisions are also changed since the expiration of these taxes in 1995. (The Infrastructure Investment and Jobs Act (IIJA)).
The Supreme Court ruled in 2018 that the Professional and Amateur Sports Protection Act was unconstitutional. As a result, each state may decide whether to allow sports wagering. Sports wagering, like wagering in general, is subject to federal excise taxes, regardless of whether the activity is allowed by the state.
The Environmental Protection Agency's list of devices that reduce highway tractor idling is now available. These devices may be exempt from the 12% retail excise tax provided they meet the criteria set forth in section 4053(9) of the Internal Revenue Code.
An excise tax is a tax imposed on a specific good or activity. Excise taxes are commonly levied on cigarettes, alcoholic beverages, soda, gasoline, insurance premiums, amusement activities, and betting, and typically make up a relatively small and volatile portion of state and local and, to a lesser extent, federal tax collections.
Excise taxes are imposed on manufacture, sale, or consumption of commodities, and upon licenses to pursue certain occupations. Federal dependence on excise taxes is down significantly since 1950, when almost 20 percent of federal tax collections were from excise taxes. Today, excise taxes only make up about 3 percent of federal collections as individual and corporate income tax revenues have grown dramatically.
Excise taxes can be employed as Pigouvian taxes, or sin taxes, to price in externalities. An externality, in economics terms, is the side effect or consequence of an activity that is not reflected in the cost of said activity. For instance, excise taxes may be employed to reduce consumption of cigarettes or sugar-sweetened beverages, to curb pollution, or to reduce traffic congestion.
If you are a corporation, limited partnership, limited liability company, or business trust chartered, qualified, or registered in Tennessee or doing business in this state, then you must register for and pay franchise and excise taxes. The franchise tax is based on the greater of net worth or the book value of real or tangible personal property owned or used in Tennessee. The excise tax is based on net earnings or income for the tax year.
Whether registering your vehicle for the first time or renewing your registration, you will pay an annual excise tax and a registration fee. Passenger vehicles and recreational vehicles have separate vehicle excise tax rates.
When you register your motor vehicle or trailer, you have to pay a motor vehicle and trailer excise. Get the ins and outs on paying the motor vehicle excise tax to your city or town hall.This guide is not designed to address all questions which may arise nor to address complex issues in detail. Nothing contained herein supersedes, alters or otherwise changes any provision of the Massachusetts General Laws, Massachusetts Department of Revenue Regulations, Department rulings or any other sources of the law.Updated: February 24, 2023
If you own a registered motor vehicle or trailer, you have to pay a tax, called a motor vehicle and trailer excise, each year. When you get your motor vehicle excise bill, you will also get instructions on how to pay it.
The excise rate is $25 per $1,000 of your vehicle's value. It is charged for a full calendar year and billed by the community where the vehicle is usually garaged. If your vehicle is registered in Massachusetts but garaged outside of Massachusetts, the Commissioner of Revenue will bill the excise. 041b061a72