The difference and connection between consumption tax and value-added tax:

1. Consumption tax is a tax within the price (the tax calculation basis includes the consumption tax amount), while value-added tax is an extra-price tax (the tax calculation basis is does not include value-added tax); both are turnover taxes.

2. Consumption tax on most taxable consumer goods is only levied once when the goods leave the factory and are sold (or entrusted for processing or import), and will no longer be levied on subsequent wholesale and retail links. Value-added tax is levied at all stages of production and circulation of goods.

The tax base for calculating consumption tax and value-added tax on taxable consumer goods is the same, both are sales including consumption tax but excluding value-added tax.

3. Consumption tax is a supporting tax type of value-added tax. It is established to adapt to the establishment of value-added tax as a universal adjustment tax, which is generally levied on production and operation links, supplemented by consumption tax as a special adjustment tax, and selects some consumer goods ( Cigarettes, alcohol, cosmetics, high-end cars, etc.), a new tax type established to implement the turnover tax of a double-layer adjustment mechanism for cross-taxation.

4. Value-added tax is a tax shared by the central and local governments. The central government charges 75% and the local governments charge 25%. But when paying value-added tax, it is paid to the national tax, and then the national tax allocates 25% to the local tax. Excise duty is a central tax and all belongs to the central government.

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