The income tax law provides for specific categories of expenses and also allows discretion to the concerned authority to allow expenses which are not specifically indicated. Individuals are taxed on income derived from salaries, house property, professional income, capital gains and other income. The tax law does not allow deduction of any expenses incurred by an individual except expenses incurred for business or profession and incurred in acquiring capital assets. These treaties provide for favourable treatment of computing taxable business profits. Specifically, income like dividends, interest, royalty and fees for technical services are taxed at lower rates than those applicable under the domestic law.
Excise duty is payable on manufactured products.
The duty rate is commodity dependent and varies from year to year. The rates are ad valorem, specific or a combination of both. Sales tax is imposed on sales of goods. The incidence of tax is primarily on the seller who may or may not shift the burden on the purchaser. Each province has its own sales tax administration and the tax charged is commodity dependent and varies from year to year.