Quick Summary
Amid widespread confusion following the government's decision to impose fresh excise duty on cigarettes, the Finance Ministry has clarified that the National Calamity Contingent Duty (NCCD) will continue to remain applicable on cigarettes from February 1, 2026. According to Finance Ministry sources, the new tax structure for cigarettes will consist of three components: 40% GST, newly imposed Central Excise Duty and the existing NCCD. This clarification puts to rest speculation that NCCD may be
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FAQ :
No, the Finance Ministry has clarified that the NCCD will continue to remain applicable on cigarettes from February 1, 2026.
The new tax structure for cigarettes will consist of 40% GST, newly imposed Central Excise Duty, and the existing NCCD.
The revised tax structure, including the additional excise duty on tobacco products and health cess on pan masala, will be effective from February 1, 2026.
The objective is to create a dedicated and predictable resource stream for health and national security priorities.
The GST compensation cess, which was used for loan repayment to states, will cease after January 31, 2026, as the loans are scheduled to be fully repaid.
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