If manufacturer say manufacture ball pen in his factory, and excise duty is 12.5%, on ball pen, now manufacturer will purchase plastic for manufacture lower body and upper body, say also buys metal refill and plastic refill and metal parts required. This is all raw material,
now when he manufacture pen he will supply goods to wholesale distributor, while supplying goods his price will include:
1)manufacturingcost 2)Profit he will charge, as distributor will pay for transportation cost from manufacturer place to his shop.
My question is manufacturer will charge excise on manufacturing cost or manufacturing cost plus profit? manufacturing cost include every cost like labour cost, raw material cost which also include excise plus transportation plus sales tax, octroi,loading and unloading. he will also incur powercost, after calculating this cost he will collect profit on the goods, that you will understood.
so again my question is at what stage excise is to be calculated? on manufacturing cost which do not include profit or excise should be calculated on manufacturing cost+profit margin