No Decision taken on “Sin Tax” on Tobacco, Demerit and Luxury Goods at the 55th GST Council Meeting
Experts suggest that the additional revenue generated from taxing "sin goods" could help counteract tax cuts, providing financial relief to citizens while advancing public health objectives
The Union Minister for Finance and Corporate Affairs Nirmala Sitharaman chaired the 55th meeting of the GST Council, in Jaisalmer, Rajasthan, today. No Decision taken on 35% “Sin Tax” on Tobacco, Demerit and Luxury Goods were taken. Finance Minister Briefed the media persons about the Decisions taken during the 55th meeting of the GST Council. Union Finance...
The Union Minister for Finance and Corporate Affairs Nirmala Sitharaman chaired the 55th meeting of the GST Council, in Jaisalmer, Rajasthan, today. No Decision taken on 35% “Sin Tax” on Tobacco, Demerit and Luxury Goods were taken. Finance Minister Briefed the media persons about the Decisions taken during the 55th meeting of the GST Council.
Union Finance Minister Nirmala Sitharaman asserted that there have been no discussion of ‘Sin Tax’ throughout the meeting .Thus Ending the rumours on 35 % ‘Sin Tax’.
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At a recent webinar organised by 'Tobacco Free India', a citizens' initiative, experts endorsed the recent recommendation by the Group of Ministers (GoM) for a 35 per cent 'Sin Tax' slab on tobacco products, up from the current 28 per cent.
This created speculations that this recommendation would be taken up during the GST Council meeting.However it wasn't even considered.
Experts suggest that the additional revenue generated from taxing "sin goods" could help counteract tax cuts, providing financial relief to citizens while advancing public health objectives.
The Future of Tax and Finance: Upskill with Us
Dr. Arvind Mohan, Professor of Health Economics at the University of Lucknow, linked tobacco taxation with India's development goals. He argued that tobacco use undermines human capital, stressing that tax rates on tobacco have declined in real terms over the past decade, falling short of global standards. Reversing this trend with a Sin Tax would send a strong message about prioritizing public health. He pointed out that India’s National Health Policy (2017) and the Parliamentary Standing Committee on Health (2022) have emphasized tobacco taxation as an effective measure to reduce consumption.
Dr. Prashant Kumar Singh, from ICMR’s National Institute of Cancer Prevention and Research, highlighted the tobacco-related deaths in India, urging urgent intervention. He stressed the importance of raising taxes to discourage harmful consumption and redirecting the revenue towards preventive healthcare to support Universal Healthcare goals.
Dr. Pritam Datta, from NIPFP, warned that India’s tobacco tax rates are below global standards, urging action before the Compensation Cess expires in 2026.
The Future of Tax and Finance: Upskill with Us
The participants included Union Minister for State for Finance Shri Pankaj Chaudhary, Chief Ministers of Goa, Haryana, Jammu and Kashmir, Meghalaya and Odisha; Deputy Chief Ministers of Arunachal Pradesh, Bihar, Madhya Pradesh, Rajasthan and Telangana; the Finance Ministers of States/UTs, besides Secretary of Department of Revenue, Chairmen and Members of CBIC and senior officials of the Ministry of Finance.
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