On 27 September 2026, the NBR released a general order addressing the use of differentiated stamps and bandrols for cigarettes falling under HS Code 2402.20.00, following a government decision to increase the maximum retail price (MRP) of cigarettes. The order provides detailed instructions on the application of value-added tax (VAT) and supplementary duty (SD) across different price tiers, ensuring that the revised pricing structure is correctly reflected in tax stamps affixed to cigarette packs. This measure is part of the broader tobacco control and revenue mobilization strategy, aligning physical stamp denominations with updated price bands to prevent revenue leakage and ensure accurate tax collection at the point of manufacture and import.
Key Takeaways
- Price-Tiered Stamp System: New stamps and bandrols must be used according to the revised MRP brackets, replacing the previous uniform stamp regime.
- VAT and SD Alignment: The order clarifies the calculation and collection of VAT and supplementary duty for each price tier, ensuring tax liability matches the new retail prices.
- Immediate Implementation: Manufacturers and importers must comply immediately; non-compliance may result in penalties under the VAT and Supplementary Duty Act.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement