The World Health Organization (WHO) has launched the '3 by 35 Initiative', urging countries to raise taxes on sugary drinks, alcohol, and tobacco by 50% over the next decade. The goal is to curb consumption and prevent related non-communicable diseases. The Indian Ministry of Finance addressed this initiative, clarifying that tax decisions are made by the GST Council, which includes representatives from both the central and state governments. The ministry also noted that taxes on alcohol for human consumption are under the purview of state governments, not the central government. Currently, in India, sugary aerated drinks are subject to the highest GST rate of 28% along with a 12% Compensation Cess. Tobacco products also face a 28% GST rate, with a Compensation Cess that can go as high as 290%. In addition, a separate central duty is levied on tobacco products.

GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
LOK SABHA
UNSTARRED QUESTION NO. 4008

TO BE ANSWERED ON MONDAY, AUGUST 18, 2025/ SRAVANA 27, 1947(SAKA)

TAXATION OF SUGARY DRINKS, ALCOHOL AND TOBACCO

4008. COM. SELVARAJ V:

SHRI SUBBARAYAN K:

Will the Minister of FINANCE be pleased to state:

(a) whether it is a fact that the World Health Organisation (WHO) has demanded the countries to raise the prices of sugary drinks, alcohol and tobacco by 50 percent over the next ten years through taxation to tackle chronic public health problems; and

(b) if so, the details thereof and the Government's reaction thereto?

ANSWER
MINISTER OF STATE IN THE MINISTRY OF FINANCE
(SHRI PANKAJ CHAUDHARY)

(a) & (b) As per '3 by 35 Initiative' launched by World Health Organization (WHO) in July 2025, countries have been urged to increase taxes on sugary drinks, alcohol, and tobacco by 50 % over the next 10 years to reduce consumption and to prevent related non-communicable diseases. GST rates are prescribed on the basis of the recommendations of GST Council which comprises of members from Union Government and state/UT governments. Alcohol for human consumption is under the purview of State governments.

Currently, aerated drinks containing added sugar attract the highest rate of 28% along-with Compensation Cess of 12%. Tobacco products attract 28% GST along-with varying Compensation Cess rates ranging upto 290%. In addition, tobacco products also attract central duty over and above GST and Compensation Cess.