📈 Simplify Your GST with Expert Support
💬 Chat with GST Expert
Table of Contents
- Updated on : September 19, 2025
HSN Chapter 24: Tobacco & Manufactured Tobacco Substitutes Classification & GST India
HSN Code & GST Rate for Tobacco & Tobacco Products - Chapter 24
HSN Chapter 24 maintains a strategic dual-rate GST structure post-September 2025 reforms, supporting tobacco farmers with low rates on raw materials while implementing the highest taxation on manufactured products for public health objectives. This policy balances agricultural support with India's commitment to reducing tobacco consumption through fiscal measures, making Chapter 24 unique in having both the lowest and highest GST rate categories.
Key Classification Factors for Tobacco Products GST Rates
- Dual-Rate Structure: 5% for raw tobacco leaves, 28% for manufactured products
- Public Health Policy: High taxation to discourage tobacco consumption
- Farmer Support: Low rates on agricultural tobacco to support farming community
- Manufacturing Deterrent: Highest GST rates on processed tobacco products
Complete HSN Code Table: Tobacco & Manufactured Tobacco Substitutes (Chapter 24)
| GST Rate | Product Description | HSN Code | Export/Import HSN Codes |
|---|---|---|---|
| 5% | Tobacco leaves | 2401 | 24011010, 24011020, 24011030, 24011040, 24011050, 24011060 |
| 28% | Unmanufactured tobacco, tobacco refuse (other than tobacco leaves) | 2401 | 24011010, 24011020, 24011030, 24011040, 24011050, 24011060 |
| 28% | Cigars, cheroots, cigarillos and cigarettes, of tobacco or of tobacco substitutes | 2402 | 24021010, 24021020, 24022010, 24022020, 24022030, 24022040 |
| 28% | Other manufactured tobacco and manufactured tobacco substitutes including bidis; homogenised or reconstituted tobacco; tobacco extracts and essences | 2403 | 24031110, 24031190, 24031910, 24031921, 24031929, 24031990 |
| 28% | Products containing tobacco or reconstituted tobacco intended for inhalation without combustion | 240411 | 24041100 |
| 28% | Products containing tobacco or nicotine substitutes intended for inhalation without combustion | 240419 | 24041900 |
🚬 Strategic GST Structure for Tobacco Products - September 2025:
- Farmer Welfare: Raw tobacco leaves at 5% GST to support agricultural community and rural livelihoods
- Public Health Priority: All manufactured tobacco products at highest 28% GST rate to discourage consumption
- Revenue Generation: High taxation on tobacco products provides significant government revenue for health programs
- Manufacturing Deterrent: Processing tobacco attracts maximum GST, discouraging tobacco manufacturing expansion
- Import Control: High GST rates make imported tobacco products expensive, supporting domestic health policies
- Policy Consistency: Maintained pre-reform structure showing government commitment to tobacco control
- Additional Levies: Tobacco products may attract cess and additional duties beyond base GST rates
- Compliance Complexity: Different rates within same HSN code require careful classification
- Health Outcome Focus: Tax structure designed to achieve public health objectives over revenue optimization
🌿 GST Rate Examples by Product Category:
🌱 Agricultural Tobacco Products (5% GST):
- Raw Tobacco Leaves (HSN 2401): 5% GST - unprocessed tobacco leaves from farms
- Fresh Tobacco (HSN 2401): 5% GST - recently harvested, uncured tobacco
- Dried Tobacco Leaves (HSN 2401): 5% GST - basic sun-dried or air-cured tobacco leaves
🚭 Manufactured Tobacco Products (28% GST):
- Cigarettes (HSN 2402): 28% GST - filter and non-filter cigarettes of all lengths
- Bidis (HSN 2403): 28% GST - traditional Indian tobacco rolled in tendu leaves
- Cigars & Cheroots (HSN 2402): 28% GST - premium tobacco products
- Hookah Tobacco (HSN 2403): 28% GST - flavored tobacco for water pipes
🍃 Processed Tobacco Preparations (28% GST):
- Chewing Tobacco (HSN 2403): 28% GST - processed tobacco for oral consumption
- Snuff (HSN 2403): 28% GST - finely ground tobacco powder
- Jarda (HSN 2403): 28% GST - scented chewing tobacco preparation
- Gutkha (HSN 2403/2106): 28% GST + Cess - pan masala containing tobacco
⚗️ Tobacco Extracts & Substitutes (28% GST):
- Tobacco Extracts (HSN 2403): 28% GST - concentrated tobacco essences
- Reconstituted Tobacco (HSN 2403): 28% GST - processed tobacco sheets
- Tobacco Substitutes (HSN 2402/2404): 28% GST - herbal smoking products
- E-cigarette Products (HSN 2404): 28% GST - electronic tobacco delivery systems
Frequently Asked Questions (FAQs)
What are the GST rates for tobacco products under Chapter 24 after September 2025?
Tobacco products under HSN Chapter 24 have differentiated GST rates as per the September 2025 notification. Raw tobacco leaves attract 5% GST (2.5% CGST + 2.5% SGST), while all manufactured tobacco products including cigarettes, bidis, gutkha, and other tobacco preparations attract the highest GST rate of 28% (14% CGST + 14% SGST).
Which tobacco products are at 5% GST and which are at 28% GST?
Only raw tobacco leaves (HSN 2401) are at 5% GST. All manufactured tobacco products attract 28% GST: unmanufactured tobacco other than leaves (2401), cigarettes and cigars (2402), bidis and other manufactured tobacco (2403), and tobacco substitutes (2404). This maintains the high taxation policy on processed tobacco products for public health reasons.
Why do tobacco products have the highest GST rates in India?
Tobacco products attract the highest GST rate of 28% as part of India's public health policy to discourage tobacco consumption. The September 2025 GST reforms maintained this high taxation structure for all manufactured tobacco products while keeping raw tobacco leaves at 5% to support farmers. This dual rate system balances farmer welfare with public health objectives.
Are there any additional taxes on tobacco products besides GST?
Yes, tobacco products may attract additional cess and duties beyond the 28% GST. Pan masala containing tobacco (gutkha) specifically attracts 28% GST plus additional cess. The total tax incidence on tobacco products can be significantly higher than the base GST rate due to these additional levies imposed for health and regulatory reasons.
🚬 Expert GST for Tobacco & Agricultural Industries
Professional tax consultancy for tobacco farming, manufacturing, and trade under complex GST structure
Disclaimer
The HSN codes and rates have been arranged as per the best of authors understanding and are subject to periodic updates as per the law for the time being in force. It does not constitute professional advice or a formal recommendation. While due care has been taken in preparing this content, the existence of mistakes and omissions herein is not ruled out. DisyTax will not be held responsible for any loss or damage of any kind arising out of any inaccurate or incomplete information in this document.