Govt deals a blow to beer lovers

Govt deals a blow to beer lovers

With Summer not far away, beer lovers are in for some bad news. The brew is going to get costly as the state government has increased additional excise duty on it.

So a pint may cost Rs 25-35 more in the coming days.

As is the practice, companies used to increase the price of beer from Rs 10-15 every February.

This year the beer manufacturing companies are yet to increase the price or as some sources say, they may not this year.

The state government has not increased the excise duty on beer for the last three years. But this year the H D Kumaraswamy government has targeted the beer industry and has increased the additional excise duty on beer from 150 % to 175% in the budget presented on Friday.

The excise duty on draught beer will go up from 115% to 150%. Excise duty on beer manufactured in microbreweries will rise from the existing Rs 5 per litre to Rs 10 per litre. The additional excise duty will be increased from the existing Rs 12.50 per litre to Rs 25 per litre.

D Nanjegowda, owner of Amulya bar and restaurant in Yelahanka, said following the increase in excise duty, there may be Rs 25-35 increase in the price. If companies also increased the price, then it would be a huge blow for beer lovers, says Nanjegowda.

Moreover, it is highly likely that guzzlers may switch over to hard liquor in such a scenario.

The state government also increased the excise duty on Low Alcoholic Beverages (LAB) from the existing Rs 5 per litre to Rs 10 per litre and the additional excise duty from 122% to 150%.

Despite the apex court's ban on the sale of liquor along national highways and the subsequent closure of many bars in the city, the revenue from excise duty has increased over the years -- from Rs 4,812 crore in 2007-08 to Rs 17,948 crore in 2017-18.

The target for the year 2018-19 is set as Rs 19,750 crore. For the coming financial year, the government has set a target of Rs. 20,950 crore -- not a challenging task as liquor sale has gone up to 77 % in the past 11 years.

Meanwhile, the bar and restaurant owners are quite happy about the move, as earlier they were unofficially forced to buy hard liquor as the excise duty was much higher on it compared to beer. Some even say, as a bar owner, acquiring a certain quantity of hard liquor was mandatory if one needed to acquire beer. But, now the government seems to have bridged the gap.