Andhra introduces new excise policy, entrusts retail business with pvt dealers

The Andhra government has also announced introduction of a new category of low-priced liquor, costing ₹99 or less, to provide affordable options while maintaining quality standards and curb demand for illicit liquor

The Andhra Pradesh government on Tuesday issued orders notifying the new liquor policy for the next two years, withdrawing the retail liquor business from the government and entrusting it with private dealers.

The previous YSR Congress party government in Andhra had taken over the retail liquor sale from the private dealers and operated the business through AP State Beverages Corporation in the last five years. (Representational image)

The previous YSR Congress party government led by Y S Jagan Mohan Reddy had taken over the retail liquor sale from the private dealers and operated the business through AP State Beverages Corporation in the last five years. This policy came to an end on September 30.

In the government order, principal secretary (excise) Mukesh Kumar Meena said the new excise policy will come into effect from October 12 and till then, the government would continue to run the retail liquor business.

“The policy will have a tenure of two years, promoting stability and predictability in the regulatory environment, which is likely to encourage greater participation from retailers,” Meena said in the order.

Under the new policy, the state government has fixed the total number of shops for the licensing period 2024-26 at 3,736, of which 3,396 shops will be in the open category, while 340 shops have been reserved for the toddy tapper community.

“A separate notification and guidelines will be issued for disposal of the 340 shops earmarked for the toddy tapper community and premium stores,” Meena said.

Starting Tuesday, the government invited applications from private parties for operating 3,736 retail wine shops by paying a non-refundable application fee of ₹2 lakh each. The applications can be submitted through online or off-line or hybrid models.

The selection of dealers will be done at the district level through a draw of an online lottery, if there are more applications for one retail shop, on October 11. The selected dealers would be given licences on payment of retail excise tax ranging from ₹50 lakh to ₹85 lakh, depending on the area and the population therein. The tax could be paid in 12 instalments during the two-year licence period.

The shop owners would get a profit of 20% on their sales and the government would grant licences to 12 premium shops with a tenure of five years with licence fees of ₹1 crore. “The government is expected to generate revenue of ₹5,500 crore per annum through retail excise tax, besides other taxes,” an excise department official familiar with the development said.

The government order also announced introduction of a new category of low-priced liquor, costing ₹99 or less, to provide affordable options while maintaining quality standards and curb demand for illicit liquor. “National suppliers shall be encouraged to introduce reputed national brands at this rate,” the order said.

The government has also decided to allow the private retail wine shop dealers to upgrade their outlets into model shops across the state on payment of an additional retail excise tax of ₹5 lakh in addition to the annual tax they would pay. “Model stores will be permitted to stock and sell all liquor related accessories like ice buckets, ice tongs, wine corks screws, trays, glasses, goblets in the licensed premises,” Meena said.