Tobacco GST Overhaul: Rates Rationalised from Feb 2026

New GST Rate for Biris
The notification includes Biris falling under tariff headings 2403 19 21 and 2403 19 29 in Schedule II, attracting a GST rate of 9%.
Major Additions to the 20% Tax Slab
Several tobacco and related products have been moved to Schedule III, attracting a 20% GST rate. These items include:
- Pan masala (2106 90 20)
- Unmanufactured tobacco and tobacco refuse (2401)
- Cigars, cheroots, cigarillos, and cigarettes (2402)
- Other manufactured tobacco and substitutes, excluding biris (2403)
- Inhalation products containing tobacco or reconstituted tobacco without combustion (2404 11 00)
- Inhalation products containing tobacco or nicotine substitutes without combustion (2404 19 00)
Elimination of Schedule VII
The entire Schedule VII, which carried a GST rate of 14%, along with all its related entries, has been omitted from the tax structure.
Effective Implementation Date
All these changes, as per Notification No. 19/2025–Central Tax (Rate), will officially come into force starting from 1st February, 2026.
Strategic Policy Objectives
These amendments are designed to rationalise the GST rate structure for tobacco products, provide clarity in product classification, and align the tax framework with broader public policy goals.