Budget is harmful for its health!
The irony of this entire existence of the cigarette industry never ceases to baffle. The industry earns the highest, second best after the IT industry. And yet, it is penalized the most. Come February and the moods in the offices of ITC and the other cigarette companies in India gets pretty somber. There are hushed whispers and there seems to be an almost scared, almost muted and resigned kind of expression on the faces of the employees. After all, this is the time when the Govt, almost like a ritual, in the Union Budget, announces a hike in the excise duty.
In February, irrespective of the results or the already existing excise duty, the Govt, probably to show that it does not support smoking, hikes excise duty. And the cigarette stocks, before the Budget usually slumps. Last time was probably the only time when there was no hike, it was a status quo for the sector. But this time around, it does not look like the sector will find any escape. The excise duty hike is almost certain and the industry is not exactly waiting for 28th Feb.
The irony here is that the Govt wants all the money from the cigarette industry but at the same time, in an holier than thou attitude, wants to tax the sector. This double-edged, hypocritical attitude is wrong – either stop the complete usage of cigarettes or don’t make a pretense of punishing the sector.