Cigarette Market Braces for Price Hike as Government Implements Revised Excise Duties

The Indian government has announced a significant revision in excise duties on cigarettes, effective February 1, 2026. Prices are projected to rise by as much as ₹11 per stick, with taxation structured according to cigarette length. This measure is part of broader fiscal and public health strategies.

Key Highlights:

• Price Hike: Cigarettes could cost up to ₹11 more per stick.
• Tax Structure: Excise duty will vary by stick length, impacting both short and long cigarettes.
• Consumer Impact: Smokers will face higher costs across categories, including premium and regular brands.
• Industry Reaction: Tobacco companies may adjust pricing strategies to manage demand.
• Public Health Angle: The government aims to discourage smoking while increasing tax revenues.
• Economic Context: The move aligns with fiscal consolidation efforts and health policy objectives.

This excise duty revision is expected to reshape the tobacco market, influencing consumption patterns and industry dynamics while reinforcing India’s commitment to public health.

Sources: The Economic Times, Business Standard, Mint