GST Reforms: Council Approves 40% Highest Tax On Tobacco And Sin Goods

After the 56th GST Council meeting in New Delhi, Finance Minister Nirmala Sitharaman announced a steep 40% GST on sin and luxury goods. The new slab covers cigarettes, gutka, pan masala, zarda, and bidis — replacing the earlier 28% plus cess, which will end once loans are repaid. Aerated drinks with added sugar and caffeinated beverages are also included. The decision is aimed at discouraging harmful consumption and ensuring luxury and unhealthy items carry the highest tax burden.