Quick Summary
The Government of India has introduced the Central Excise (Amendment) Bill, 2025 in the Lok Sabha, proposing significant increases in Central Excise duty on tobacco and tobacco-related products. The amendments aim to revise the tariff rates listed under Section IV of the Fourth Schedule of the Central Excise Act, 1944. The bill, tabled by Finance Minister Nirmala Sitharaman on 28th November 2025, seeks to provide the Centre fiscal room to increase duties on tobacco once GST Compensation Cess on
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FAQ :
It is a bill introduced in the Lok Sabha by the Government of India proposing significant increases in Central Excise duty on tobacco and tobacco-related products.
The hikes are proposed to restore fiscal space for the Centre once the temporary GST Compensation Cess on tobacco products is discontinued, ensuring stable tax revenue and discouraging tobacco consumption.
The bill affects unmanufactured tobacco, cigarettes, cigars, cheroots, cigarillos, smoking mixtures, hookah, gudaku tobacco, chewing tobacco, jarda, snuff, tobacco extracts, essences, and nicotine products.
Yes, there are substantial hikes proposed across various lengths of cigarettes, with some non-filter and filter cigarette categories seeing duty increases of over 1000%.
Nicotine products intended for inhalation or oral/transdermal intake will now attract a 100% excise duty, signalling tighter control and potentially higher costs.
Consumers can expect sharp price rises for cigarettes, cigars, chewing tobacco, and hookah products. The government's intention is to reduce consumption through higher taxes, thereby improving public health.
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