Central Excise on Tobacco FAQs (Effective Feb 1, 2026), we have attached the central excise full notification on these taxes for more calrity
The new rule is coming into force from the February 1 2026 for tobacco manufacturers. Certain taxes are being introduced for these.
What are effective duty rates on tobacco products?
Notified in No. 03/2025-Central Excise and 04/2025-Central Excise (Dec 31, 2025).
Where are Packing Machines Rules found?
No. 05/2025-Central Excise (N.T.) (Dec 31, 2025).
Goods covered?
Chewing tobacco (incl. filter khaini), jarda scented tobacco, gutkha pouches under Sec 3A (No. 04/2025-Central Excise N.T.).
What do Packing Machines Rules cover?
Capacity determination and duty collection for pouch machines.
Separate registration for existing taxpayers?
No.
All manufacturers pay deemed duty?
No, only pouch makers; others on assessable value.
Abatement on RSP?
Yes, per No. 01/2022-Central Excise (N.T.).
Central Excise New Tobacco Tax know more
Declaration deadline?
Form CE DEC-01 by Feb 7, 2026.
Mandatory filing?
Yes.
Declaration parameters?
Machines, capacity, gear ratios, RSP; Chartered Engineer cert needed.
Actual production matters?
No, deemed on max capacity.
Duty calculation?
Annual capacity-based (Sec 3A); interim RSP x speed (e.g., 500 pouches/min, RSP ₹2 = ₹0.83 Cr/month/machine).
Fresh declaration allowed?
No, post Rule 8 order.
Dept capacity determination?
Inspection x 12 months.
Higher dept capacity?
Pay differential + interest from Feb 1, 2026 (first-time).
Appeal?
Pay per order.
Monthly determination?
No, only on changes.
Ministry of Corporate Affairs Achievement in 2025 Read
New install mid-month?
Full month duty.
Machine count?
Max daily in month.
Monthly filings?
Form CE STR-1 by 10th + returns.
Abatement formula?
Pro-rata non-op days.
Non-op example (Feb 15-Mar 5)?
Claimable if ≥15 continuous days.
Abatement conditions?
3-day notice, sealing.
Machines deemed operating?
Yes, unless sealed.
Sealing procedure?
3-day notice.
De-sealing?
3-day notice, Superintendent present.
Machine removal?
3-day notice.
CCTV required?
Yes, 24-month footage.
Rebate?
No.
Factory closure?
Surrender registration, Rule 21 adjust/refund.
Duty-free exports?
No.
