Cigarette price up illegally

Stores selling cigarettes in the City are making the most of Finance Minister P Chidambaram's announcement of increasing excise duty on cigarettes.

The Union Budget for the financial year 2013-14 has said that the specific excise duty on cigarettes, cheroots and cigarillos will be increased by about 18 per cent. And, taking advantage of this, shops in the City are already selling cigarettes at the new rates, imposing the burden on the consumers even before they are legally bound to take the liability.

Shivaprasad Shetty, a shop owner near Cambridge Layout, who is selling a packet of cigarette that is supposed to cost Rs 58 at Rs 65 said: “The new prices are in line with the increase in the excise duty by the Centre.”

For people who do not buy whole packs, the burden is more as the percentage of hike is more. However, a deputy commissioner-rank officer from the State Excise department told Deccan Herald: “Going by the rule book, what they are doing is wrong. They are only allowed to sell at the price the product carries on its label and not charge more.”

The logic behind such a rule, another official explains: “Although the duties have been increased, it must be understood that old stock is procured at old rates, and, thereby, it is illegal to sell it at a higher price.”

Jijo Cheriyan, an advertising professional, argues: “When they have not begun paying more, why should we? I have seen budgets that have reduced prices of certain things in the past, and none of the shop owners then introduced new prices immediately.

They would always argue that the new prices are applicable only from the new financial year, or when the new packaging is done. Why should we be burdened now?”
Ignorance among people allow shop owners sell articles at prices they want even before the change in prices are implemented by manufacturers.