|The News Minute | March 13, 2015 | 6:00 p.m. IST |
India’s largest cigarette manufacturing company, ITC, has increased prices of cigarettes and the new packs with revised prices are expected to hit the market in the coming few days.
According to a report in The Economic Times, the increase of 21% of sub-65mm cigarette (like small Gold Flakes) prices is the highest yet. A hike in prices between 13-15% is expected on the standard and the longer variety of cigarettes.
The rise in price comes after the government increased excise duty by 15%. While analysts were reportedly expecting a price hike closer to 10-12%, a regular Gold Flake packet of 10 cigarettes will now cost Rs 109 instead of Rs 95.
Reportedly, cigarette vendors have already increased prices and while the ITC didn’t comment on the hike, they did comment on the prices.
“ITC sells the cigarettes to wholesale dealers on a principal-to-principal basis. The wholesale dealers, in turn, sell to secondary wholesalers from whom retailers buy for eventual sale to consumers. There are a number of retail outlets that prominently display price lists showing the MRP of the various brands for consumers' benefit; there are also many fair-price retail shops that sell cigarettes at the maximum retail price,” the spokesman said.
This is the fourth consecutive year that the government has increased taxes on cigarettes.