The new state excise policy is likely to spell doom for small traders of imported foreign liquor (IFL) while the price of the liquor is also likely to double. Under the policy for 2017-18, the government has fixed a minimum bid price of Rs 50 crore and there will be only one wholesale licence for IFL across the state.
Earlier, there was a provision of multiple traders and Gurgaon had 11 of them. There was provision of a licence fee based on the volume of IFL procured and sold. From this year, licences will be issued after e-tendering.
Small liquor traders are not happy with the new provisions and have decided to approach the government to clarify the new rules. They allege that this would give way to one big player in IFL. Terming the policy “negative”, the traders have alleged that the government is “encouraging the grey market”.
The traders also feel that prices would go up to 50% for IFL, including wine and beer. Gurgaon-based traders said that the new policy only aids the dominance of liquor mafia and it should have instead focussed on broad basing the trade by facilitating more competition.
“When the bidder is paying such a hefty licence fee, he will charge that from the consumers. The government is promoting a monopoly as the trader will charge any amount willingly,” said one of the affected traders.
The state VAT has increased from 26.25% to 34.65% this year. This essentially means that an IFL bottle is going to cost 50% more.
What has rankled the traders the most is the provision that there will be only one wholesale licence for IFL in the state. The licence will be granted by inviting e-tenders on the department’s portal but the traders said this process will only ensure that a vast majority is thrown out of the trade.
“We are unhappy with the policy, though we have asked for clarity from the government. This is neither a customer, nor a vendor-friendly policy. We have multiple swords at our neck — sometimes its a proposed ban within 500 metres of a state and national highway or the monopoly in the IFL market. With the new policy, only the Haryana government will benefit,” said Neeraj Sachdeva, managing director, Lakeforest Wines.
“This is not a favourable policy and there will be huge losses to the vendors. There will be an impact on sale of imported liquor and only the government will benefit,” said Pawan Jain, MD of Saksham Wines.
“With the new excise policy we will have to shut our business as we will be the worst hit. It is also disappointing for imported liquor lovers as they will have to shell out 50% more to drink any IFL brand,” said Subhash Kukreja, owner of Kukreja Wines.
The licence shall be granted to firms/companies or persons having an import licence from the excise and taxation commissioner, subject to the provisions of excise laws.
As per the new policy, the licensee shall be authorised to import IFL, including beer, from other countries and supply it to vendors, restaurant, pubs and bars.