The Tobacco Institute of India (TII) has raised concerns on the increase in National Calamity Contingent Duty (NCCD) on cigarettes, saying India may become a preferred destination for “smuggled cigarettes” as the tax hike will incentivize illegal cigarette trade operators.
TII said illegal cigarettes have grown consistently in the country and now account for one-fourth of the Indian cigarette market.
In a released statement TII said, “In the current economic environment the proposed increase announced in the Union Budget on NCCD will aggravate the pressure on the legal cigarette industry, encourage illegal cigarette trade and adversely impact tobacco farmer earnings whose livelihood is intrinsically connected with the legal cigarette value-chain.”
“In the interest of the FCV tobacco farming community and the legal cigarette industry which is reeling under huge pressure we appeal to the finance minister to reconsider the proposal and withdraw the NCCD levy.”