CBIC notifies rate changes in Compensation Cess pertaining to “Pan Masala” with declared retail sale price & “Tobacco Products” as per recommendations of the 50th GST Council Meeting

Background:

Earlier,  the 50th Meeting of the GST Council was held on July 11, 2023 in New Delhi, wherein it was recommended that on pan masala, tobacco products etc, where it is not legally required to declare the retail sale price, the earlier ad valorem rate as was applicable on March 31, 2023 may be notified in order for levy of Compensation Cess.

Notification:

Now, the CBIC vide Notification No. 03/2023 – Compensation Cess (Rate) dated July 26, 2023 has issued amendment in Notification No. 1/2017- Compensation Cess (Rate) dated June 28, 2017 to implement the recommendations of the 50th GST Council Meeting.

It has been notified that on pan masala, tobacco products etc, where it is not legally required to declare the retail sale price, the earlier ad valorem rate, as was applicable on March 31, 2023 may be notified in order for levy of Compensation Cess.

Entry no. 52B in compensation cess notification has been amended to include all utility vehicles by whatever name called provided they meet the parameters of Length exceeding 4000 mm, Engine capacity exceeding 1500 cc and having Ground Clearance of 170 mm & above and to clarify by way of explanation that ‘Ground clearance’ means Ground Clearance in un-laden condition.

Cess Rate for Pan Masala, Unmanufactured tobacco, Tobacco refuse, ‘Hookah’ or ‘gudaku’ tobacco, etc. notified.

This Notification shall come into force on July 27, 2023.

The Complete Notification can be accessed at: https://egazette.gov.in/WriteReadData/2023/247627.pdf

(Author can be reached at info@a2ztaxcorp.com)

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