{"id":97368,"date":"2023-03-27T11:50:00","date_gmt":"2023-03-27T06:20:00","guid":{"rendered":"https:\/\/tradebrains.in\/features\/?p=97368"},"modified":"2023-03-27T11:37:23","modified_gmt":"2023-03-27T06:07:23","slug":"biz-gst-tobacco-cess","status":"publish","type":"post","link":"https:\/\/tradebrains.in\/features\/biz-gst-tobacco-cess\/","title":{"rendered":"Govt caps maximum GST cess rate on pan masala, tobacco; links rate to retail sale price"},"content":{"rendered":"<div class=\"trade-content_2\" style=\"margin-left: auto;margin-right: auto;text-align: center;\" id=\"trade-4148409425\"><p><a href=\"https:\/\/tradebrains.in\/get\/telegram\/\"><img decoding=\"async\" class=\"alignnone wp-image-101992\" src=\"https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2023\/01\/telegram-channel-300x119.png\" alt=\"\" width=\"148\" height=\"59\" \/><\/a> <a href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMN3Epgswxc--Aw?hl=en-IN&amp;gl=IN&amp;ceid=IN%3Aen\"><img decoding=\"async\" class=\"alignnone wp-image-123430\" src=\"https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2024\/05\/follow-on-google-news-300x82.png\" alt=\"follow-on-google-news\" width=\"222\" height=\"61\" srcset=\"https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2024\/05\/follow-on-google-news-300x82.png 300w, https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2024\/05\/follow-on-google-news-150x41.png 150w, https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2024\/05\/follow-on-google-news.png 468w\" sizes=\"(max-width: 222px) 100vw, 222px\" \/><\/a><\/p>\n<\/div><p>The government has capped the maximum rate of GST compensation cess that would be levied on pan masala, cigarettes and other forms of tobacco and linked the highest rate to their retail sale price.<\/p><div class=\"trade-content_7\" style=\"margin-left: auto;margin-right: auto;text-align: center;\" id=\"trade-2774928545\"><!-- Composite Start --> \r\n <div id=\"M923760ScriptRootC1549812\"> \r\n <\/div> \r\n <script src=\"https:\/\/jsc.mgid.com\/t\/r\/tradebrains.in.1549812.js\" async> \r\n <\/script> \r\n <!-- Composite End --><\/div><p>The capping of the cess rate was brought in as part of the amendments to the Finance Bill, 2023, which was passed by the Lok Sabha last Friday.<\/p><p>As per the amendment, the maximum GST compensation cess rate for pan masala will be 51 per cent of the retail sale price per unit. In the current regime, the cess is charged at 135 per cent ad valorem.<\/p><p>The rate for tobacco has been fixed at Rs&nbsp;4,170 per thousand sticks plus 290 per cent&nbsp;ad valorem&nbsp;or 100 per cent&nbsp;of the retail sale price per unit.<\/p><div class=\"trade-content_5\" id=\"trade-3384390388\"><script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-4023722985638610\"\r\n     crossorigin=\"anonymous\"><\/script>\r\n<!-- in_content_2_news -->\r\n<ins class=\"adsbygoogle\"\r\n     style=\"display:block\"\r\n     data-ad-client=\"ca-pub-4023722985638610\"\r\n     data-ad-slot=\"7925020301\"\r\n     data-ad-format=\"auto\"\r\n     data-full-width-responsive=\"true\"><\/ins>\r\n<script>\r\n     (adsbygoogle = window.adsbygoogle || []).push({});\r\n<\/script><\/div><p>So far, the highest rate was Rs 4,170 per thousand sticks plus 290 per cent ad valorem.<\/p><p>The cess is levied over and above the highest Goods and Services Tax (GST) rate of 28 per cent.<\/p><p>Changes in schedule-I of GST compensation cess Act, brought in via amendment in Finance Bill, has capped the maximum cess that can be charged on Pan masala and tobacco products.<\/p><p>Tax experts, however, said to ascertain the exact compensation cess applicable following this change, the GST council will need to issue a notification.<\/p><p>AMRG &amp; Associates Senior Partner Rajat Mohan said the latest amendment in the GST Compensation cess law is an enabler that will permit the GST council to introduce applicable tax rates through a notification.<\/p><p>&#8220;This change marks a significant shift in taxation policy for pan masala and tobacco-supplying companies. Though this policy will arrest tax evasion to a great extent in this sector, it still may prove to be a regressive plan from an economic standpoint,&#8221; Mohan said.<\/p><div class=\"trade-content-10\" id=\"trade-1763850036\"><script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-4023722985638610\"\r\n     crossorigin=\"anonymous\"><\/script>\r\n<!-- in_content_3_news -->\r\n<ins class=\"adsbygoogle\"\r\n     style=\"display:block\"\r\n     data-ad-client=\"ca-pub-4023722985638610\"\r\n     data-ad-slot=\"2969612066\"\r\n     data-ad-format=\"auto\"\r\n     data-full-width-responsive=\"true\"><\/ins>\r\n<script>\r\n     (adsbygoogle = window.adsbygoogle || []).push({});\r\n<\/script><\/div><p>In February, the GST Council chaired by Union Finance Minister Nirmala Sitharaman and comprising state counterparts, had approved the report of a panel of state finance ministers on plugging tax evasion in&nbsp;pan masala and gutkha businesses.<\/p><p>The GoM had recommended that the mechanism for levy of compensation cess on pan masala and chewing tobacco be changed from ad valorem&nbsp;to a specific rate-based levy to boost the first stage collection of the revenue. PTI JD DRR<\/p><div class=\"trade-after-content\" id=\"trade-279053450\"><div id=\"taboola-below-article-thumbnails\"><\/div>\r\n<script type=\"text\/javascript\">\r\n  window._taboola = window._taboola || [];\r\n  _taboola.push({\r\n    mode: 'alternating-thumbnails-a',\r\n    container: 'taboola-below-article-thumbnails',\r\n    placement: 'Below Article Thumbnails',\r\n    target_type: 'mix'\r\n  });\r\n<\/script>\r\n<script type=\"text\/javascript\">\r\n  window._taboola = window._taboola || [];\r\n  _taboola.push({flush: true});\r\n<\/script><\/div>","protected":false},"excerpt":{"rendered":"<p>The government has capped the maximum rate of GST compensation cess that would be levied on pan masala, cigarettes and other forms of tobacco and linked the highest rate to their retail sale price. The capping of the cess rate was brought in as part of the amendments to the Finance Bill, 2023, which was [&hellip;]<\/p>\n","protected":false},"author":13,"featured_media":19782,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[1697,31],"tags":[],"class_list":["post-97368","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy","category-news"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v20.5 (Yoast SEO v25.0) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Govt caps maximum GST cess rate on pan masala, tobacco; links rate to retail sale price - Trade Brains Features<\/title>\n<meta name=\"description\" content=\"The government has capped the maximum rate of GST compensation cess that would be levied on pan masala, cigarettes and other forms of tobacco and linked the highest rate to their retail sale price.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/tradebrains.in\/features\/?p=97368\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Govt caps maximum GST cess rate on pan masala, tobacco; 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