FM: States to benefit from tobacco excise duty hike

© Proceeds to be part of the divisible pool

- FE BUREAU

FINANCE MINISTER NIRMALA Sitharaman on Wednesday said excise duty collected on tobacco and related products will be part of the divisible pool, with 41% shared with states, ensuring that states also benefit following the expiry of the GST compensation cess.

Responding to the debate on the Central Excise (Amendment) Bill in the Lok Sabha, she emphasised that the measure does not introduce any additional tax burden and merely maintains the current tax incidence applicable under the GST regime. The Bill, which was passed by the House, seeks to reintroduce excise duty on tobacco products to replace the GST compensation cess.