Excise fees: Unease in govt over ease of doing business

Bengaluru: The steep hike in various excise fees has caused consternation within the government, especially on how this could hit the ease of doing business in Karnataka for the beverage industry. 

According to sources, one minister who is involved in the state’s efforts to attract investments has flagged these concerns with Chief Minister Siddaramaiah’s office.

“We have told the finance department that this does not bode well for the state,” the minister, who declined to be identified, said. 

This minister got involved after he came to know that a neighboring state was wooing Mysuru-based Huli Spirits, the maker of what is billed
as India’s first jaggery-based rum. 

“The state government is literally forcing Huli to move out of Mysuru to Goa or Maharashtra. The annual distillery license fee has been increased by 50%! Is this Congress’ idea of ease of doing business?” Huli cofounder Aruna Urs said in a tweet. 

Subsequently, Aruna said he got a call from the office of the chief minister of a neighbouring state “with an offer to tailor excise policies to suit” his business.

“They had tracked me down via (X). That is some commitment to governance and prosperity!,” he wrote. 

In December 2023, the minister referred to above was instrumental in restoring permission to Heineken-controlled United Breweries, Belgium-headquartered AB InBev, Danish brewer Carlsberg and home-grown B9 Beverages (Bira) to operate third shift (10 pm to 6 am) at their facilities in Mysuru. 

The minister had pulled up the excise department for halting third shift operations at the breweries.

He argued that the excise department’s decision ran the risk of hampering the state’s ease-of-doing-business reputation.