Centre hikes excise duty on cigarettes, new rates from Feb 1

Srinagar, Jan 01: The Finance Ministry has notified a major revision in excise duty on cigarettes and other tobacco products, with the new rates set to come into effect from February 1, 2026.

According to the official notification the government has imposed an additional excise duty on cigarettes ranging from Rs 2,050 to Rs 8,500 per 1,000 sticks. The revised duty structure varies depending on the length and type of cigarettes.

The newly notified excise duty will be levied over and above the existing 40 percent Goods and Services Tax applicable to cigarettes, tobacco and similar products. This effectively increases the overall tax burden on tobacco consumption.

The revision is aimed at strengthening revenue collection while also discouraging the consumption of tobacco products, which pose serious public health risks. Cigarettes in higher length categories are expected to witness a sharper increase in prices due to the higher excise slabs.

The revised excise duty rates will apply uniformly across India once implemented from February 1, 2026, as per the notification. [KNT]