New Delhi: Now you have to spend more money to puff a cigarette. Finance Minister Nirmala Sitharaman has proposed to increase the National Calamity Contingent Duty (NCCD) on cigarettes by 16 percent in the budget presented today. India is among the 182 countries that have signed a WHO Framework Convention on Tobacco Control. Under this, it has been recommended to impose at least 75 percent tax on the retail price of all tobacco products. In India, 52.7 per cent tax on cigarettes, 22 per cent tax on bidis and 63.8 per cent tax on curd tobacco. According to a survey, about 270 million people above the age of 15 in India use tobacco in some form or the other. India is the second largest consumer and third largest producer of tobacco in the world.
Experts say that increasing taxes and stricter laws on tobacco items will not only improve the health of the people but will also help India to become a five trillion economy by 2025. Professor Arvind Mohan, head of the Department of Economics, Lucknow University, said that the health problems caused by tobacco put a huge burden on the country’s economy. This is 1.04 percent of the country’s GDP. According to experts, increasing the tax on tobacco will fill the coffers of the government.
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fall in stocks
Shares of cigarette companies declined on BSE after the announcement of tax hike on cigarettes. Shares of other cigarette companies including Godfrey Phillips India and ITC Ltd fell up to five per cent. Shares of Godfrey Phillips declined 4.92 per cent to Rs 1,828.75 while Golden Tobacco declined 3.81 per cent to Rs 59.4 on the BSE. At the same time, ITC’s share fell 0.78 percent to Rs 349. NTC Industries declined up to 1.4 per cent and VST Industries was down 0.35 per cent.
