About Cesses and Surcharges: Cess and surcharges are levied by the Central government for the purposes of the Union under Article 271 of the Constitution of India. A cess is a tax on tax. The Indian government levies it on the tax liability, including surcharge, and it is used for a specific purpose. Cesses are named after the identified purpose; the purpose itself must be certain and for the public good. Some different types of cesses levied in India are infrastructure cess on motor ... Cess is a tax on tax collected for a specific purpose and not spent for any other purpose. Learn about the different types of cess in India, such as GST compensation cess, road and infrastructure cess, and health and education cess. Cess on income tax is an additional charge levied to fund specific government initiatives like healthcare, education, and rural development. It’s calculated as a fixed percentage of your income tax—for example, the 4% health and education cess. Unlike regular taxes, cess funds are used only for their intended purposes, ensuring efficient resource allocation. Through cess, the government tackles key public welfare issues and promotes inclusive, sustainable development across the country. Simply put, cess is a type of tax levied by governments to raise funds. The funds raised from a cess can only be used to finance that particular purpose for which it was levied. There is a legal obligation for the government to use cess funds for a particular purpose only.
