Which of the following components of Central Government taxes on petroleum products is/are not shareable with the States?
- 1Basic Excise Duty
- 2Additional Excise Duty
- 3Special Additional Excise Duty
Select the correct answer using the code given below.
- A1 and 2 only
- B1, 2 and 3
- C3 only
- D2 and 3 only
Explanation
Of the central taxes on petroleum products, only the Basic Excise Duty forms part of the divisible pool shared with the states. The Special Additional Excise Duty and the Road and Infrastructure Cess (the "additional" and "special additional" excise duties in the question) are levied as cesses/surcharges and are not shareable with the states — a position clarified by Finance Minister Nirmala Sitharaman in 2022. Hence statements 2 and 3 are the non-shareable components, and statement 1 (Basic Excise Duty) is shareable. The answer is (D). (Cross-checked with Testbook's CDS-I 2024 solutions.)