Excise taxes are taxes imposed by governments on specific goods or services that are considered to be bad for society or that increase the cost of living. These taxes are primarily paid by businesses, but they also affect consumers indirectly since they cause prices to go up. Common items that are subject to excise taxes include fuel, tobacco, and alcohol, as well as services such as casino gaming, parking garages, and movie theaters.

Excise taxes can be classified into two types: ad valorem taxes, which are taxes paid by percentage, and specific taxes, which are taxes charged by a certain unit, such as cents per gallon for gasoline. For example, an ad valorem excise tax on cigarettes of twenty percent is an additional twenty cents for every dollar spent on a pack of cigarettes.

In addition, sin taxes are a form of excise tax on goods that have a high social cost, such as alcohol and tobacco. These taxes are used to discourage people from buying and using these products, with the goal of improving public health. Sin tax revenue is often used to fund health and social programs.

Apart from the aforementioned items, excise taxes can also be imposed directly on consumers, such as on property taxes or on certain retirement account activities. These taxes vary from country to country, and usually represent an additional cost that consumers must bear when engaging in the specified activity.

In conclusion, excise taxes are a form of taxation imposed by governments primarily on businesses but which may also be indirectly felt by consumers through increases in prices. They are typically used to raise revenue and discourage people from buying and consuming certain goods or services deemed to have a high social cost.