Overview
- Small retailers, the Swadeshi Jagran Manch, AICPDF and the Indian Sellers Collective warn steep increases could push consumers to smuggled and counterfeit cigarettes, hurting lawful sales.
- India has previously seen illicit cigarettes reach 26.1% of the market, with estimated annual tax losses above Rs 23,000 crore.
- Recent examples used as cautionary tales include BAT South Africa closing a plant under pressure from illegal sales and Azerbaijan detaining a former customs chief over tobacco smuggling.
- Advocates urge balanced taxation, stronger border and customs action, and monitoring of digital channels to prevent long-term entrenchment of illegal supply chains.
- Stakeholders say brick-and-mortar distributors already strained by e-commerce could see livelihoods eroded, while policymakers have not signaled a change to the scheduled hike.