Union Finance Minister Nirmala Sitharaman while addressing at the Rajya Sabha today, the average annual revenue collection of tobacco products base on the last three years is about Rs 53,750 crores. Based on the recommendations of the GST Council, the GST rates, together with compensation cess rates on goods, are mounted. Several NGOs and client education forums have asked the Minister of Finance to increase taxes on tobacco products considering the health impact.
"In the GST Council, we have formed a Group of Ministers (GoM). It has given the terms of reference to see if, on the capacity of a producing unit, where evasion is high, we can consider looking at an increase in the price.” "Such items like tobacco have conjointly been placed into that list… We will stay up for the GoM to come back with its recommendations," says Sitharaman.
A politician, Prasanna Acharya of the Biju Janata Dal political party, had asked the FM that will the central government place proposal for increasing tax on tobacco within the Council.
In the written reply, Sitaraman said that based on the last three years, the average annual revenue collection, together with the GST, compensation cess, excise duty from tobacco products, is about Rs 53,750 crore. She also said that the central government decides the excise duty and NCCD on tobacco products, and there is no proposal for any additional duty.