Table 1

Taxation of tobacco products in India—pre-GST and post-GST (FY, 2017–2018)

Tobacco itemPre-GST structurePost-GST Structure
ExciseVATGSTNCCDCompensation cess
INR/1000 sticksINR/1000 sticksSpecific
INR/1000 sticks
Ad valorem
Cigarettes (weighted average)2504.131.54%28%116.22882.110.1%
  Non-filter <65 mm168131.54%28%9020765%
  Non-filter 65–70 mm302131.54%28%14536685%
  Filter <65 mm168131.54%28%9020765%
  Filter 65–70 mm221631.54%28%9027475%
  Filter 70–75 mm302131.54%28%14536685%
  Other442131.54%28%235417036%
Bidi (weighted average)16.3815.25%28%1.0200
  Machine-made3515.25%28%200
  Hand-made1615.25%28%100
103%30.94%28%10%0104%
  • Excise duty pre-GST also includes the NCCD. Specific taxes (excise, compensation cess and NCCD) on cigarettes and bidi are per 1000 sticks. Average excise duties for cigarettes and bidi are weighted based on market share for different tiers while average VAT rates on all products are weighted based on states’ consumption shares. The compensation cess on SLT is a simple average of the cesses for all chewing tobacco varieties under tariff item 2403 listed by the Central Board of Excise and Customs. VAT, GST and ad-valorem cesses are applied on pretax value added at each stage of the supply chain. US$1≈INR 68.

  • GST, goods and services tax; INR, Indian rupee; NCCD, National Calamity Contingent Duty; SLT, smokeless tobacco; VAT, value-added tax.