Experts say the tax hike will have a marginal impact on cigarette prices

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The announcement of a 16 percent increase in taxes on cigarettes in the 2023-24 General Budget will have a marginal impact on their prices. Experts said it would have an impact of 7 to 12 paise per cigarette in different categories.

The announcement of a 16 percent increase in taxes on cigarettes in the 2023-24 General Budget will have a marginal impact on their prices. Experts said it would have an impact of 7 to 12 paise per cigarette in different categories. He said this increase in the National Contingent Calamity Service (NCCD) will have a marginal impact on cigarette smokers and businesses will easily absorb the impact. There will be no significant impact on the margin.

Finance Minister Nirmala Sitharam on Wednesday proposed a 16 percent increase in taxes on cigarettes in the Union budget for 2023-24. The NCCD on certain cigarettes was last revised three years ago, she said in her budget speech in Parliament. It is proposed to increase it by approximately 16 percent.” Commenting on the impact of the move, Anand Kulkarni, Director of CRISIL Ratings, said: “The upward revision in NCCD on cigarettes is not expected to affect the profitability of cigarette manufacturers. A 15-16 percent increase in tax would result in a 7-12 paise increase in the price of a cigarette in different categories (depending on size, filter, etc.)

He said it would have less than a 1 percent impact on profits and would not affect the tax credit for businesses. Avneesh Roy, chief executive and head of the research committee at Nuwama Institutional Equities, also said the net impact would be negligible. He said: “This growth is lower than our estimates and those of the market. So it is positive for ITC and other tobacco companies.” He said that for this the tobacco companies will have to increase prices only two or three percent, which is not much.

Disclaimer:Prabhasakshi has not edited this news. This news has been published from PTI-language feed.



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