From 1 February 2026, the Centre replaced the GST Compensation Cess on tobacco and pan masala with two new levies. Tobacco products will carry an Additional Excise Duty, and pan masala will carry a Health and National Security Cess. Cigarettes, tobacco and pan masala will be in the 40% GST slab, while bidis stay at 18%. The change keeps these items taxed heavily after the compensation cess ends.