Hike in I-T exemption: Here are lesser known taxes that you will have to pay

Did you think that the only taxes being levied were on your income and capital gains? What about the gift tax, DDT or clean energy cess? Yes, these are among the several taxes and surcharges that you owe to the government. So before you celebrate the increase in exemption bestowed by the budget, go through the list of other, lesser known taxes that you will be required to pay.

Education cess

Whether you feel charitable or not, the government ensures you are. It levies an education cess on most taxes, which is 2% of the total tax payable.

Secondary & higher education cess

Apart from education cess, this is the other surcharge levied on most taxes to better the education system in the country. This is charged at the rate of 1% on the tax payable.

Wealth tax

Too much of a good thing can be taxing (pun intended), especially if your net worth is more than Rs 30 lakh. If you have assets, such as cash, jewellery, cars, a second property, whose combined value is more than this, you will have to pay a wealth tax of 1%.

Clean energy cess

This is imposed on all producers of coal, lignite and peat at the rate of Rs 50 a tonne. The cess filters down to the manufacturer of products (like steel) in which these are used, and eventually to you, when you pay for the product.

Excise duty on fuel
Commonly known as road cess, this is an additional duty of excise that is levied on petrol and diesel at Rs 2 a litre. This is used for rural development and state road projects, besides being shared by the National Highways Authority of India and the railways.

National calamity contingent duty
Did you know that when you buy a car, SUV or a two-wheeler, 1% of the price you pay goes into the coffers of the National Calamity Contigency Fund? From this year on, the list includes mobile phones too.

Dividend distribution tax

When companies and mutual funds distribute dividends, investors don’t have to pay tax on these. However, companies and debt/debt-oriented mutual funds do have to pay a dividend distribution tax, and they usually deduct this from the dividend they pay. So, effectively, investors receive a lesser amount.

Securities transaction tax

Every time you buy or sell shares on a stock exchange, a fraction of the money is deducted as securities transaction tax (STT). This tax is applicable on purchase or sale of equity shares, derivatives and equity-oriented mutual funds and is automatically charged by your broker.

Gift tax

If you receive a gift worth more than Rs 50,000 from a friend, you have to pay tax on it. The gift could be shares, jewellery, artifacts or even property. However, gifts received from specified relatives, through inheritance or on marriage, are not taxable.
Luxury tax

Whenever you book a hotel room, find out the rate inclusive of all taxes. This is because hoteliers have to pay a luxury tax, which they pass on to the customers. So, on a room rate of Rs 2,000, you could end up paying Rs 300 more.

Entertainment tax

This tax is the reason why movie tickets are so expensive. Entertainment tax is levied by the state governments and varies from 15-40% across the country. This tax is also applicable to large commercial shows and private festivals.

Service tax

Every time you avail of a service, whether it is buying a policy from an insurer or getting a haircut, service tax is included in the bill. Though it is the service providers who are supposed to pay the tax, they pass it on to the customers.