India Mulls Folding Cess on Luxury Goods Into GST, Mint Reports

June 25, 2025, 2:54 AM UTC

The compensation cess levied on luxury goods is likely to be integrated into GST levied on these items, Mint newspaper reported, citing two unidentified people familiar with the matter.

  • Government is willing to integrate cess on items like cars, tobacco and aerated drinks
  • Cess is levied on top of GST and is set for an expiry in March 2026
    • It was introduced to compensate states for potential revenue loss due to the transition to new tax regime
  • Cess collection is expected to fetch 1.67 trillion rupees this year
  • The administration is also planning to eliminate the 12% GST slab and ...





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