In a move targeting one of India’s biggest public health challenges, the government has imposed excise duty on tobacco products, including cigarettes, effective February 1, 2026. Shares of major players ITC and Godfrey Philips tumbled as much as 8% on the announcement, signaling tough times ahead for the industry.
Late Wednesday, the finance ministry notified the Chewing Tobacco, Jarda Scented Tobacco and Gutkha Packing Machines (Capacity Determination and Collection of Duty) Rules, 2026. Under the rules, excise duty ranges from ₹2,050 to ₹8,500 per 1,000 cigarette sticks, scaled by length. This layers on top of the existing 40% Goods and Services Tax (GST), pushing retail prices higher for an estimated 10 crore smokers in the world’s most populous nation.
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The decision comes amid rising concerns over tobacco-related illnesses, which claim over 13 lakh lives annually in India, per WHO data. Officials frame it as a deterrent to curb consumption, especially among youth, while boosting revenue for health initiatives.
(This story has been published from a syndicated feed)
