Rise In Illicit Tobacco Trade

GST authorities have detected 61 cases of illicit tobacco products, including cigarettes and pan masala, involving tax amounting to Rs 104.38 crore in the first quarter of the current financial year, as per government data. The Directorate General of Goods and Services Tax Intelligence (DGGI) and other authorities have detected these cases during the April-June period, it said. Besides, it said, customs field formations and Directorate of Revenue Intelligence (DRI) have seized around 3.93 crore sticks of cigarettes in the current financial year up to June 2025. According to the DRI data, seizures of smuggled cigarettes have witnessed a sharp spike between 2019-20 and 2023-24, rising by over 107 per cent in volume and more than 110 per cent in value. High-margin goods like gold, tobacco, and alcohol are heavily taxed, creating strong incentives for smuggling and tax evasion. Their high value and steady demand make them prime targets for illicit trade, often fuelled by arbitrage and

The proposed amendments in the law regarding cigarettes and other tobacco products are more likely to increase illicit tobacco trade thus leading to more consumption rather than lessening it

The seizure value for mis-declaration of goods stood at Rs 1,187 crore in 2016