ITC slumps over 5 pct on worries over higher taxes in budget

Shares of biggest cigarette manufacturer ITC Ltd (ITC.NS) fall more than 5 percent on a media report that the government may raise taxes on cigarettes aggressively in the upcoming budget in July, dealers say.

Union health minister Harsh Vardhan has sought an increase in tax on cigarettes of all lengths by 2 to 3.5 rupees per stick, newspaper Economic Times said in a report on Friday.

“Although the previous government had raised tax on cigarettes by about 19 per cent in February 2013, the increase was too little to lower consumption,” the report quoted the minister as saying.