The government will not impose any additional Goods and Services Tax (GST) on tobacco products but plans to maintain the current overall tax burden by introducing a new central levy outside the GST framework, Moneycontrol reported on Monday, citing government officials.

The move comes as the GST Compensation Cess regime approaches its phase-out in 2026. The cess, which was introduced in 2017 to make up for states’ revenue losses after the GST rollout, continues to be collected to repay loans raised by the Centre during the pandemic.

“One thing is clear that there will be no additional GST on tobacco and related items. The second thing is that the tax incidence will be kept the same using an additional central tax levy,” a senior government official told Moneycontrol.

The official added

See Full Page