GST Rate Changes on Tobacco Products: Notification 19/2025 Explained

Auto-drafted from official sources and under review by CA Rajeev Ranjan. Verify against the original notification before you act.

What Changed

The government issued Notification 19/2025-Central Tax (Rate) on 31 December 2025, amending GST rates on certain tobacco products. This notification modifies the earlier Notification 09/2025, so businesses relying on the previous rate structure need to update their working immediately.

Following this, an Advisory dated 23 January 2026 clarified how RSP-based (Retail Sale Price-based) valuation applies to notified tobacco goods. RSP-based valuation means GST is calculated on the printed maximum retail price of the product rather than on the transaction value, a method commonly used for products where price manipulation is a concern.

For the specific revised rates and the exact list of goods covered, refer to the official notification directly, as the precise figures are not reproduced here.

Who Is Affected

This update directly impacts:

• Manufacturers of tobacco and tobacco-based products covered under the notification
• Wholesale dealers and distributors supplying notified tobacco goods
• Retailers who purchase these goods for resale
• Tax professionals and finance teams managing GST compliance for any entity in the tobacco supply chain

If your business buys, sells, or manufactures tobacco products that fall under the amended list, you are in scope and must act promptly.

What You Need to Do

Given that the notification was effective 31 December 2025 and the advisory followed on 23 January 2026, compliance is not prospective, it is already due. Here is a practical checklist:

• Review the notification: Read Notification 19/2025-Central Tax (Rate) and cross-reference it against Notification 09/2025 to identify exactly which goods and rates have changed.
• Check RSP valuation applicability: Confirm whether your products fall under the RSP-based valuation method as clarified in the January 2026 advisory, and update your tax computation accordingly.
• Update invoicing and billing software: Ensure your GST invoices reflect the revised rate and correct valuation basis from the effective date.
• Reconcile past invoices: If any invoices were raised after 31 December 2025 using old rates, assess whether credit notes or amendments are required.
• File returns accurately: Ensure GSTR-1 and GSTR-3B filings from the relevant period onwards reflect the corrected rate and valuation.
• Brief your supply chain partners: Vendors and customers in the tobacco supply chain may also need to align their records.

The Bottom Line

This is an immediate compliance requirement, not a future planning exercise. Tobacco product suppliers should treat the advisory of 23 January 2026 as a prompt to complete their internal review without delay. When in doubt about the specific rates or product classifications, refer to the official notification and seek professional advice.

Source: Official notification