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In this video, the concept of excise taxes is discussed. An excise tax is a specific tax imposed on certain goods and services, such as fuel, alcohol, cigarettes, air travel, and phone service. Unlike a sales tax, which is more general, excise taxes are targeted at specific items. The excise tax on these goods can be quite high, with examples like a $1.00 per pack federal excise tax on cigarettes. Excise taxes can be imposed at both the federal and state levels.