Indian and foreign analysts were expecting a substantial increase in excise duty on cigarette
Finance Minister Nirmala Sitharaman in her first Union Budget speech said the excise duty on other than filter cigarettes of length not exceeding 65 millimetres and exceeding 65 millimetres but not exceeding 70 millimetres increased to Rs 5 per thousand pieces against nil earlier.
Excise duty on filter cigarettes of length (including the length of the filter, the length of filter being 11 millimetres or its actual length, whichever is more) not exceeding 65 millimetres, exceeding 65 millimetres but not exceeding 70 millimetres and exceeding 70 millimetres but not exceeding 75 millimetres also increased by Rs 5 per thousand pieces against nil.
Indian and foreign analysts were expecting a substantial increase in excise duty on cigarette, so this is very small compared to excise duties in the US and European countries.
"Hence this increase is not very substantial against higher street expectations and in addition, there is a relief that there won't be any tax on cigarettes at least for this year," Shailendra Kumar, CIO at Narnolia Financial Services told Moneycontrol.At 1451 hours IST, ITC was up 1.08 percent at Rs 280.70, Godfrey Phillips was up 0.3 percent at Rs 834.60 and Golden Tobacco gained 0.32 percent at Rs 31.60 on the BSE.Get access to India's fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code "GETPRO". Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.