The Shift in Taxation Policy
The Indian central government is preparing to introduce new levies on tobacco and pan masala products as the existing Goods and Services Tax (GST) compensation cess is scheduled to lapse. This fiscal adjustment, expected to take effect in the coming months, aims to maintain revenue stability for states while addressing long-standing public health concerns regarding these specific commodities.
The move follows the conclusion of the five-year compensation period initially promised to states upon the implementation of the GST regime in 2017. With the compensation guarantee ending, the GST Council is pivoting toward a more sustainable tax structure for
