The UT Administration has increased the Value Added Tax (VAT) on cigarettes from 12.5 per cent to 20 per cent. The UT Assistant Excise and Taxation Commissioner RC Bhalla said, “The proposed increase in VAT on cigarettes from existing 12.5 per cent to 20 per cent has been approved. The notification in this regard would be issued on Wednesday.”
The move of increasing VAT in Chandigarh is aimed at bringing the rates at par with the neighbouring States of Punjab and Haryana. The VAT on cigarettes in Punjab is 20.5 per cent while it is 20 per cent in Haryana. Punjab Government had last month, reduced VAT on cigarettes from 50 to 20.5 per cent. Notably, Chandigarh was declared a smoke-free city in 2007, imposing a ban on having a puff in public places.