Indian-made liquor gets dearer after excise duty hike

Indian-made liquor gets dearer after excise duty hike

The state government has announced a hike in excise duty on Indian-made liquor (IML) by 8% to achieve the revenue target, this year.

In his budget speech Chief Minister Siddaramaiah said that revenue target for the year 2017-18 could not be achieved with closure of several liquor shops in view of Supreme Court order.

"We had set a revenue target of Rs 18,050 crore for the year 2017-18. By January-end, Rs 14,572 crore revenue was collected. Due to the Supreme Court order banning liquor shops within the radius of 500 metres on national highways, during the months of July, August and September, more than 3,000 Excise licenses were cancelled and were not renewed." The Supreme Court order was implemented and the licences were only renewed in the subsequent months," Siddaramaiah said.

The government has set a target of Rs 18,750 crore for the Excise department for 2018-19 and hopes to mobilise a revenue of Rs 17,600 crore for the said fiscal.

The decision to hike excise duty has not gone down well with the industry. Govindaraj Hegde, secretary of Federation of Wine Merchants Association, said: "The hike in excise duty on Indian-made liquor by 8% will decrease the sale of liquor in the state. This may also increase the duplication of liquor."

Manu Chandra, National Restaurant Association of India's (NRAI), Bengaluru chapter, said, "Increase in excise duty will have an adverse impact on the business. This is a constant attack over and over again on the same commodity after the recent impact of the closer of the bar on the highways."

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