ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Taxation on Tobacco in India

An increased disposable income among Indians has expanded their tobacco purchasing power and tobacco consumption. In fact, beedis and smokeless tobacco are increasingly being used among women and children which portends that the present taxation system does not motivate users to give up smoking.

Tobacco Taxation

The tax hikes on smoking tobacco in 2014 appear large in the aggregate, but have little effect on the price of single cigarette sticks, a popular mode of retail in India. Analysing the seemingly large tax hikes on smoking tobacco, it is argued that taxes can and must go higher to ensure substantial increases in single cigarette stick prices.
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