Excise duty is principally levied in the conversion of natural items to commercial items. Excise duties were levied within intermediate production i.e. transferring from one process to another process too. These days, excise is levied at the factory gate under physical control mechanism or self-issuance (self-removal) mechanism. In case of import of goods and services, excise is levied as same as domestic production. 
 

Although the rates at which VAT is levied is limited in number, excise is levied with different rates/amounts for different items. If there is not any realistic costing mechanism for valuation, specific rate is preferred, which is controlled through physical stock which is relatively easier to count. 
 

The price for levying excise duty is determined as under:
 

Particulars	Determination of price
On Production of goods	The factory price determined by the producer for excisable goods for sale from the factory; or the price determined by IRD on the basis of production cost of the goods.
On import of excisable goods	Price determined for the purpose of custom duty plus the amount of custom duty charged on the goods. Value for custom duty                                     xxx + custom duty                                                  xxx Value for determining excise duty                 xxx
On service provided	The invoice price for the service rendered
Reference Price	Excise Officer may fix the price for the purpose of excise

 

In case	Responsibility to determine/collect price
Manufacturer producing excisable goods	The responsibility to determine and collect excise duty shall be in the manufacturer producing goods and services attracting excise duty.
On import of excisable goods	The responsibility to determine and collect excise duty shall be in the manufacturer producing goods and services attracting excise duty.
Excise duty is levied at retail level	In case of import of goods, the responsibility is vested to the custom offices from where the goods are imported.

1.4.    Time of levying excise duty:
 

In case of	Time to levy Excise duty
Issue of Goods under Physical Control System	Excise duty shall be levied at the time of issuance after production from the enterprises for the purpose of sales.
Issue of Goods & Services under Self-Removal System	Excise duty shall be levied at the time of issuance of invoice
Import of Goods	The custom office shall level excise duty at the custom entry point at the time of import.
Import of Services	The time to levy excise duty shall be as prescribed by IRD

In case	Time to levy Excise duty
Goods being issued under Phys1cal Control System	At the time of issuance
Goods are issued or manufactured under self - removal system,	Within 25th of the month immediately following the month of issuance of invoice
Import of Goods	At   the time of import
Import of Services	As prescribed by IRD