New cess bill on sin goods likely as Parl opens today

Union finance minister Nirmala Sitharaman is scheduled to introduce a bill in the Lok Sabha on Monday to levy “Health Security se National Security Cess” on pan masala and any other items notified by the central government to meet expenditure on national security and for public health, people in the know of the matter said on Sunday.

- Rajeev Jayaswal and Saubhadra Chatterji

The bill may immediately impose a cess on pan masala and could later extend it to other sin goods such as cigarettes and tobacco products (excluding bidis), they said. It is also expected to empower the central government to add any item to the list in the future in the interest of public welfare.

Once the bill becomes an act, the proposed cess will come into effect on the day the government notifies it in the official gazette, the people added.

Apart from the cess bill, the government also intends to introduce The Insurance Laws (Amendment) Bill, 2025 to raise the foreign direct investment (FDI) limit in the insurance sector to 100% from 74%. The Health Security se National Security Cess Bill, 2025 is on the schedule of the Lok Sabha’s list of business for Monday along with The Central Excise (Amendment) Bill, 2025.

According to the proposed health and national security legislation, the levy is expected on the production capacity of specified items. Individual producers or firms will self-declare location-wise production capacity of their units for the purpose of the cess, they said.