New GST rates on tobacco to be levied from February 1; cigarettes and pan masala to attract 40% tax

There's a sin tax on tobacco products that will be levied from February 1st. Cigarette pan masala to be costlier from February 1st. There's exercise duty on tobacco products that will be levied from February 1st is what we're learning. Remember, in the GST reforms that had been announced earlier in twenty, 2540% GST had been marked on cigarettes, 18% GST on BDS from February 1st. In fact, pan masala cigarettes, tobacco and similar products will be attracting a GST rate of 40% while BDS will attract 18% Goods and Services Tax according to the government notification. This is what we are learning at this given point. These are points which had in fact been flagged in that very GST reform that had been released earlier in 2025. While the rest of the GST reforms have already begun to be applicable, this particular syntax that had been announced back then was said that it will be applicable from a little later. Now that date has been announced, February 1st is when we will see the syntax being applicable on all tobacco products including cigarettes, which will be at 40%. It will be taxed at 40%, while if we speak of BDS, it will be taxed at 18 percent. Goods and services tax, That's the amount that's gonna be. That's a percentage that's gonna be impact imposed on these products. So this is push from the government at this given point of time for with with regards to health concerns at this given point. Amit Bharadwaj in fact, joining me on the broadcast with more details on this very move. Amit, very good morning to you. This is what we are looking at in terms of the syntax that's being levied. We now know a date to when this 40% and 18% respectively shall be imposed on cigarettes and beeries in the country. Good morning, Sir. You know this was very much in the cards because during the Parliament itself, the template for this was you know said and it was very much passed in the Parliament as well in order to clear any hurdles on the way of adding the is additional assess on whether it be the cigarettes or the pan masalas. Now well have to go back to the GST revisions that were done during the GST 2.2 reforms. And at that point in time, it was pretty much clear that 40% of taxes will be levied GST taxes will be levied on the sin goods under which a false cigarette and pan masalas as well. Along with that additional help says say national security says was also introduced in order to put, you know, further taxes on these tools in goods which are pretty much, you know, used by a large section of people in the country. So there's a health guideline which was kept into in the mind as well because as per the global standards you can't keep sin goods like tobacco and pan masalas at affordable rate. So the government, there was a sentiment within the government to you know, further increase it in order in accordance with the purchase capacity of people. Now, what will be the impact, overall impact of the taxes because this is very complicated tax slab that remains there as far as the cigarette and pan masalas are concerned more so with cigarette. So what kind of impact will be there, whether the manufacturers are ready to pass it on to the final consumers and which a section of commodities within these pan masalas and cigarettes will be, you know, more likely to get a bigger hit? Because what is being assumed by the industry experts is that cigarettes with the better filters and longer cigarettes, cigars would be the one which will be, you know, heavily affected by these changes. And as far as pan masalas are concerned, again the impact could be different as per the commodity or the category of the product. Now the Indian Tobacco Institute is not happy about this are the kind of the changes which have been brought. These taxes will be effective from February 1st back to you. Right, Amit, thank you for bringing us those.