Rumours are spreading on social media that the cheapest cigarettes or loose sticks, currently sold at Rs 15–20, will cost Rs 72 per stick. Many users are claiming this is a 400% hike. The claim is viral, but it is false.
Cigarette prices will increase from February 1st. However, the jump will not reach Rs 72 as circulated online. The Ministry of Finance has confirmed revisions in excise duty on cigarettes and tobacco products starting February 1, 2026.
The notification issued on December 31 states that additional excise duty will apply between Rs 2,050 and Rs 8,500 per 1,000 sticks. The rate depends on the size and type of cigarette. This is separate from the already existing 40% GST.
This revision follows a Bill passed in Parliament to increase excise duty on tobacco products. The basic excise duty had not changed for almost seven years. The new structure could sharply increase prices for bigger filter cigarettes.
Manufacturers have not released their updated rates. CNBC TV18 estimates a 20–30% increase. A cigarette that costs Rs 20 now may rise to Rs 24 or Rs 26. It will not jump to Rs 72 as rumoured.
India is the fourth largest illicit cigarette market globally. Nearly 68% of tobacco consumption remains outside the tax system. Cheapest unregulated products still circulate widely. Experts fear the hike may expand this illegal supply.
Market reactions were immediate. ITC, maker of Gold Flake, fell 9.5%. Godfrey Phillips India, distributor of Marlboro, dropped 16.86% on the stock market. The effect on consumption and public health remains to be seen.
Will higher prices actually reduce tobacco consumption and improve health outcomes? The coming months will reveal the impact of this tax move.
