Cigarette and tobacco users are facing empty shelves and higher prices even before the official hike in excise duty. Several cities, including Delhi, report shortages of popular brands as distributors and retailers hold back inventory, anticipating higher profits once the new excise regime takes effect on February 1, 2026.

Retailers say irregular supplies are disrupting normal sales, with cigarettes that previously sold for Rs 10-20 now priced between Rs 12-25 depending on the brand. “Suppliers are delaying deliveries to benefit from the post-hike prices,” said a Delhi shopkeeper, highlighting the market imbalance ahead of the official price revision.

The Finance Ministry has notified a major overhaul of the tobacco excise structure, adding a specific excise duty ranging from Rs 2,050 to Rs 8,500 per 1,000 sticks based on length and category, on top of the existing GST of up to 40 per cent. The dual taxation system is expected to push retail prices across all segments, particularly longer and filter cigarettes.

Also Read: Cigarettes and Gutkha Prices Rise Sharply From February 1 Under New Excise Duties

Smokeless tobacco, including chewing tobacco, jarda, and gutkha, will also become more expensive under the new capacity-based excise framework, which taxes products according to the number, speed, and output capacity of packing machines. Authorities say this aims to reduce tax evasion in mechanised, cash-driven sectors.

Consumers are already experiencing price increases of Rs 2-5 per stick, and supply shortages are expected to continue until distributors adjust to the new taxation structure. With the February 1 rollout, prices could rise sharply, leaving smokers and retailers to navigate tighter availability and higher costs.

The government maintains that the move aligns with public health guidelines, aims to offset inflation, and addresses rising healthcare costs from tobacco-related illnesses. While the excise revision is designed to stabilise revenues and curb evasion, consumers are bearing the immediate impact through reduced supply and higher prices.

Also Read: Saarang 2026 at IIT Madras: Five Days of Music, Dance, and New Cultural Zones Await