Breaking New Grounds in Tobacco Control - Voluntary Health ...

operating machines installed in the factory
premises.
The rates of duty are as under:
S.
No.
Retail
Sale Price
(per
pouch)
For the Millions
n 20
Rate of Duty Per
Packing Machine Per
Month
(Rs. in lakh)
Pan
masala
(1) (2) (3) (4)
1. Up to
Rs. 1.00
2. From
Rs. 1.01
to
Rs. 1.50
3. From
Rs. 1.51
to
Rs. 2.00
4. From
Rs. 2.01
to
Rs. 3.00
5. From
Rs. 3.01
to
Rs. 4.00
6. From
Rs. 4.01
to
Rs. 5.00
7. From
Rs. 5.01
to
Rs. 6.00
8. Above
Rs.6.00
9.25 12.50
14 19
18 24
26 36
34 47
43 59
51 70
50
+ 8.36
* (P - 6),
where P
represents
retail sale
price of
the pouch
Pan
masala
containing
Tobacco
69 + 11.45
*(P - 6),
where P
represents
retail sale
price of
the pouch
Advocacy for Increasing Taxes
Across All Tobacco Products
In recent years in India, state governments
have displayed political willingness and
ability to tax tobacco, yet, taxes on
tobacco were only marginally increased.
In particular, in year 2007-2008 states
like UP, Bihar, AP and MP which are hubs
of tobacco production, bidi rolling and
manufacturing, increased taxes and then
rolled back due to pressure from tobacco
industry lobbies. Even levies like entry
taxes were subsequently abolished due to
vested interests.
VHAI, its state partners and other civil
society organizations, in the beginning
of 2010, began an earnest and consistent
advocacy campaign for increasing taxes on
tobacco products, specially because, bidis in
most states was exempt and out of the tax
ambit. Political leaders, policymakers and
senior bureaucrats from the state revenue
and finance departments were approached
over several months and commitment was
sought from the highest levels. Most states,
after persistent efforts, began to show
concern about the increased prevalence
of tobacco use over the last few years in
their states and were gradually convinced
about the public health as well as revenue
benefits of a tax increase. The result was
that 11 states increased Value added Tax
( VAT ) on tobacco products and many of
them for the first time included bidi in the
tax net. The best practise model in this
advocacy campaign has been Rajasthan,
which increased VAT on all tobacco products
from 20% to 40%. Other state governments
which increased VAT on tobacco products
during the last year include Jammu &
Kashmir, Himachal Pradesh, Gujarat, Odisha,
Tamil Nadu, Assam, Andhra Pradesh, Kerala,
Madhya Pradesh and Delhi.