Lok Sabha Question No. 451 (STARRED), answered on 2023-04-03
Subject: Revision in Compensation Cess on Chewing Tobacco
Ministry: FINANCE
Asked by: Ramdas Chandrabhanji Tadas

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE

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## LOK SABHA

## STARRED QUESTION NO. *451

## TO BE ANSWERED ON MONDAY, APRIL 3, 2023/CHAITRA 13, 1945 (SAKA)

## REVISION IN COMPENSATION CESS ON CHEWING TOBACCO

## *451. SHRI RAMDAS C. TADAS:

Will the Minister of Finance be pleased to state:

- (a) whether the Government proposes to revise the compensation cess on chewing tobacco including pan masala and other tobacco products;
- (b) if so, the details thereof;
- (c) whether the Government has constituted a panel in this regard; and
- (d) if so, the details and the composition thereof?

## ANSWER

## MINISTER OF FINANCE SHRIMATI NIRMALA SITHARAMAN

- (a) to (d): A statement is placed on the Table of the House.

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## STATEMENT REFERRED TO IN REPLY TO THE LOK SABHA STARRED QUESTION NO. *451  RAISED  BY  SHRI  RAMDAS  C.  TADAS  FOR  03 rd APRIL,  2023,  ON  REVISION  IN COMPENSATION CESS ON CHEWING TOBACCO:

(a): GST  rates  and  Compensation  Cess  rates  are  prescribed  on  the  recommendation  of  the  GST Council, which is a constitutional body comprising of representatives of States/UTs and Centre. On the basis of the recommendation of the GST Council in its 49 th Meeting held on 18 th February, 2023, the rate of Compensation Cess levied on specified commodities like pan masala, gutkha, chewing tobacco, etc. have been revised.

(b): Details are placed in the Annexure.

(c) and (d) : The  GST  Council,  in  its  42 nd Meeting,  held  in  October  2020,  decided  to  constitute  a Group of Ministers (GoM) to discuss and analyze the issues pertaining to the Capacity based taxation on Pan Masala, Reverse Charge Mechanism in mentha oil, special composition scheme on brick kilns, etc. Accordingly, a Group of Ministers (GoM) on Capacity-based Taxation and Special Composition Scheme in  Certain  Sectors  in  GST  had  been  constituted  on  24.05.2021,  with  Shri  Niranjan  Pujari,  Hon'ble Minister for Finance, Odisha, as the Convener of the GoM, and Ministers from Delhi, Haryana, Kerala, Madhya Pradesh, Uttar Pradesh and Uttarakhand as members. The said GoM submitted its Final Report to the GST Council in its 49 th Meeting held on the 18 th February, 2023, based on which the revision in above-said rates have been carried out.

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## Annexure

| Heading / Subheading / Tariff item   | Description of Goods                                                                                                   | Specific rate for Compensation Cess* (per unit)   |
|--------------------------------------|------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------|
| 2106 90 20                           | Pan Masala                                                                                                             | 0.32R                                             |
| 2401                                 | Unmanufactured tobacco (without lime tube) - bearing a brand name                                                      | 0.36R                                             |
| 2401                                 | Unmanufactured tobacco (with lime tube) - bearing a brand name                                                         | 0.36R                                             |
| 2401 30 00                           | Tobacco refuse, bearing a brand name                                                                                   | 0.32R                                             |
| 2403 11 10                           | Hookah or gudaku tobacco bearing a brand name                                                                          | 0.36R                                             |
| 2403 11 10                           | Tobacco used for smoking 'hookah' or 'chilam' commonly known as 'hookah' tobacco or 'gudaku', not bearing a brand name | 0.12R                                             |
| 2403 11 90                           | Other water pipe smoking tobacco, not bearing a brand name                                                             | 0.08R                                             |
| 2403 19 10                           | Smoking mixtures for pipes and cigarettes                                                                              | 0.69R                                             |
| 2403 19 90                           | Other smoking tobacco bearing a brand name                                                                             | 0.28R                                             |
| 2403 19 90                           | Other smoking tobacco not bearing a brand name                                                                         | 0.08R                                             |
| 2403 91 00                           | 'Homogenised' or 'reconstituted' tobacco, bearing a brand name                                                         | 0.36R                                             |
| 2403 99 10                           | Chewing tobacco (without lime tube)                                                                                    | 0.56R                                             |
| 2403 99 10                           | Chewing tobacco (with lime tube)                                                                                       | 0.56R                                             |
| 2403 99 10                           | Filter khaini                                                                                                          | 0.56R                                             |
| 2403 99 20                           | Preparations containing chewing tobacco                                                                                | 0.36R                                             |
| 2403 99 30                           | Jarda scented tobacco                                                                                                  | 0.56R                                             |
| 2403 99 40                           | Snuff                                                                                                                  | 0.36R                                             |
| 2403 99 50                           | Preparations containing snuff                                                                                          | 0.36R                                             |
| 2403 99 60                           | Tobacco extracts and essence, bearing a brand name                                                                     | 0.36R                                             |
| 2403 99 60                           | Tobacco extracts and essence, not bearing a brand name                                                                 | 0.36R                                             |
| 2403 99 70                           | Cut tobacco                                                                                                            | 0.14R                                             |
| 2403 99 90                           | Pan masala containing tobacco 'Gutkha'                                                                                 | 0.61R                                             |
| 2403 99 90                           | All goods, other than pan masala containing tobacco 'gutkha', bearing a brand name                                     | 0.43R                                             |
| 2403 99 90                           | All goods, other than pan masala containing tobacco 'gutkha', not bearing a brand name                                 | 0.43R                                             |