Small retailers protest against duty hike on tobacco products

New Delhi, Jan 9 (PTI) Small retailers and pavement sellers affiliated with the Federation of Retailers Association of India held a protest outside the Ministry of Finance here on Friday against recent tax increases on legal tobacco products, citing concerns over declining sales.

The demonstration followed a Ministry of Finance notification under the Chewing Tobacco, Jarda Scented Tobacco and Gutkha Packing Machines (Capacity Determination and Collection of Duty) Rules, 2026, which imposes an excise duty ranging from‚ Rs 2,050 to Rs 8,500 per 1,000 sticks, depending on cigarette length, effective February 1, a statement said.

The changes come after the withdrawal of the compensation cess.

Retailers said the higher duties would raise prices sharply, affecting demand for legal products and impacting small sellers who operate on thin margins.

Protesters sat in a dharna outside the ministry, demanding a rollback of the revised rates and a review of the taxation structure, the statement said.

FRAI said it represents nearly 80 lakh micro, small and medium retailers across the country through 54 retail associations.

Addressing the gathering, FRAI secretary Vinay Kumar said, "Today we have come out because our lives are in danger. Sudden and big tax increases will make daily goods too costly for poor people and break the small shops that feed our families." "We earn very little already. If these prices go up, customers will not be able to afford these products. We will lose customers, lose income, and our children will go hungry. Illegal sellers will grow, but honest, hard-working people like us will be finished," he said.

"We are folding our hands and asking the government to stop and think again. Please roll back these tax rates. Come closer and take a look at the lives of small pavement earners. We want to work honestly and survive. Taxes should not take away our bread and dignity," he added.

FRAI said it is seeking a calibrated taxation policy and has urged the government to consult retailer representatives before implementing abrupt changes. PTI VBH APL APL