Excise duties are taxes levied on

Step 1: Analyze the question The question asks what excise duties are levied on. This is a public finance topic, under types of taxes.

Step 2: Explain the concept

• Import duties (customs duties): taxes on goods coming into the country.
• Export duties: taxes on goods going out of the country.
• Excise duties: taxes on goods that are produced or manufactured locally within the country, such as beer, cigarettes, and soft drinks. They are usually collected at the point of production.
• Company income tax: tax on the profits of companies (industrial incomes).

Step 3: Check each option

• A. Goods coming into the country: this is an import duty, so it is wrong.
• B. Goods going out of the country: this is an export duty, so it is wrong.
• C. Industrial incomes: this is company/profit tax, so it is wrong.
• D. Locally manufactured goods: this matches the definition of excise duty.
• E. Selected consumer durable: excise duties are not limited to durables. They often apply to items like alcohol and tobacco, which are not durables, so this is wrong.

Step 4: Answer The correct answer is D. locally manufactured goods.

Exam tip: Remember it this way: "Excise = Inside". Excise is for goods made inside the country, while customs duties apply at the border, on imports and exports.