July liquor sales hit by 50% rise in excise duty

The excise duty hike raised IMFL and country liquor prices by 60% and 20% respectively, and led to decline in sales in July by 10.9% and 9.70% respectively

Mumbai: Liquor sales dropped significantly in July compared to the first quarter of the 2025-26 financial year on the back of a 50% hike in excise duty in the last week of June.

Representational image (Getty Images)

The hike pushed up prices of Indian made foreign liquor (IMFL) and country liquor by nearly 60% and 20% respectively, while sales of IMFL and country liquor in July dropped by 10.9% and 9.70% respectively compared to average monthly sales in the April to June quarter. Beer sales, generally low during the monsoon months, too registered a 30% dip in July.

Officials from the excise department, however, said the dip in sales would not affect revenues as the quantum of increase in excise duty was much more than the hike in retail prices.

“Our additional revenue target for the 2025-26 financial year was ₹14,000 crore,” said an excise department official requesting anonymity. “Since the implementation started at the fag end of the first quarter, we expect to generate ₹10,500 during the remainder of the financial year despite a further dip in sales likely in August, when the old stock with lower prices is completely exhausted from the market.”

Another official from the department said they expect IMFL consumers to shift to Maharashtra Made Liquor (MML), a new category introduced by the state government to promote domestic manufacturers.

“The excise duty on MML has been kept significantly low to give them a level-playing field,” the official said.

However, Sanjit Padhi , chief executive officer of the International Spirits and Wines Association of India (ISWAI) said the shift to MML would hit revenue collection and the government would fall short of its target for the year.

“We reiterate that the rise in prices needs to be reviewed at the earliest,” Padhi said.

Vinod Giri, director general, Brewers Association of India, said sales of beer were likely to go up significantly later this month and in September as older stocks of IMFL with lower prices get exhausted.

“We had a mild summer and good monsoon this year so beer sales were hit significantly,” he said.