MPs flag livelihood fears for farmers, workers as Lok Sabha debates tobacco tax overhaul

New Delhi, Dec 3 (PTI) Some Lok Sabha MPs on Wednesday expressed concern over the impact of the bill that will allow the government to raise taxes on tobacco products, saying it could adversely affect the livelihoods of tobacco farmers and workers, even as they backed measures to curb tobacco consumption. The Central Excise (Amendment) Bill, 2025 seeks to replace the GST compensation cess currently levied on cigarettes, chewing tobacco, cigars, hookah, zarda and scented tobacco, all of which attract a 28 per cent GST plus a variable cess.

Opening the discussion on the bill in the lower house, BJP MP D. Purandeswari said the House must “keep farmers' security intact” while reworking the country’s tobacco taxation framework.

She noted that six million farmers, 20 million labourers and nearly 36 million people in processing and export chains depend on the crop, and urged the government to ensure that tax changes are calibrated.

Farmers are "not averse to decisions the government would take relating to the health of the country,” she said, but stressed that their interests must also be protected.

Congress MP Karti Chidambaram said the larger goal should be a clear roadmap for reducing tobacco use and shifting workers to alternative livelihoods.

“The stress here is how do we reduce tobacco usage, how do we migrate people who are involved in the tobacco industry to other sectors,” he said, warning that steep duty hikes could increase counterfeiting and black markets.

Merely “tinkering” with tax rates, he argued, would not address the structural challenge.

Samajwadi Party MP Naresh Chand Uttam Patel voiced concerns of bidi rollers, leaf-pluckers and small supari growers, saying he was speaking "for the lakhs who break tobacco leaves, who roll bidis under lantern light, who toil day and night in areca nut orchards".

Their sweat, he said, contributes thousands of crores to the economy each year. Accusing the government of imposing a heavy cess on the poorest, he urged that the Bill be sent to a select committee instead of being “rushed through”.

TMC MP Saugata Roy questioned whether fiscal tools alone could curb tobacco consumption.

Citing Bihar's liquor prohibition policy, he said Chief Minister Nitish Kumar “lost revenue but took a bold decision”, though illicit liquor remained a concern.

“Now the same question is if the finance minister can show courage and take a moral stance,” he said, adding that the government must explain what would happen to tobacco workers.

TDP MP Lavu Sri Krishna Devarayalu highlighted "contradictions" in the policy, noting that while governments speak of restricting tobacco cultivation, contract farming arrangements continue to encourage production.

Many farmers, he said, have "gone to the next level" under such agreements, resulting in higher output even as anti-tobacco campaigns expand. PTI UZM RT