Education cess and its neglect of education

Thomas, Alex M. and Nallur, Varun (2019) Education cess and its neglect of education. Centre for Budget and Policy Studies.

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Towards the end of March, we all rush to complete our investments in the Tax Saving instruments and also furnish our declarations to save tax. There would be very many of you even despite all the exemptions end up paying taxes to the government. Ever wondered what happens to the different taxes collected from you? All taxes that are collected by the government goes to the Consolidated Fund of India (CFI) account which is then allocated for different purposes i.e. building roads, railways, parks etc. Cess is also another form of a tax which is additionally levied by the government to raise monies to meet a very specific expenditure; for example, education cess for education, Krishi Kalyan cess for improving agriculture and so on. Both the normal tax and cess collection finds its way to the government’s CFI account. However, the key difference is that a cess can be used only for the purpose it has been collected and be spent through a dedicated reserve account which is set up. For e.g., education cess can be used for education purposes only. Any unspent amount for any particular year should be carried forward and be used in the next year.

Item Type: Other
Authors: Thomas, Alex M. and Nallur, Varun
Uncontrolled Keywords: Education, Education cess, Secondary education
Subjects: Social sciences > Economics
Divisions: Azim Premji University > School of Arts and Sciences
Full Text Status: Public
Publisher URL:

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