IndiaPosted at: Dec 2 2025 12:23PM


Central Excise (Amendment) Bill 2025 set for LS passage, proposes steep duty hikes on Tobacco products

New Delhi, Dec 2 (UNI) The Central Excise (Amendment) Bill, 2025, aimed at replacing the existing GST compensation cess on tobacco products and revising excise duties, is slated for passage in the Lok Sabha on Tuesday. Introduced on December 1, the bill seeks to amend the Central Excise Act, 1944, which governs the levy of excise duties on goods manufactured in India.
Since the rollout of the Goods and Services Tax (GST) in 2017, many central excise duties were repealed except on select items like tobacco and tobacco products. To compensate states for revenue losses due to GST, a GST compensation cess was also levied on tobacco products, resulting in these items being subject to GST, compensation cess, and central excise duty concurrently. The proposed bill plans to discontinue the compensation cess while increasing central excise duties to maintain the current tax burden on tobacco products.
Significant increases in duty rates are proposed. For example, the duty on unmanufactured tobacco such as sun-cured leaves will rise from 64 pc to 70 pc. Excise duty per thousand cigarettes, which currently ranges between Rs 200 and Rs 735, will see a dramatic hike, proposed to range from Rs 2,700 to Rs 11,000.
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Tags: #Central Excise (Amendment) Bill 2025 set for LS passage# proposes steep duty hikes on Tobacco products
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