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K’taka clocks ₹22,851 cr revenue from liquor sales
Bengaluru The excise department in Karnataka clocked ₹22,851 crore in the 2020-21 fiscal year with additional revenue of at least ₹200 crore expected to be generated in the remaining week or so in March, according to excise department data and officials
Bengaluru The excise department in Karnataka clocked ₹22,851 crore in the 2020-21 fiscal year with additional revenue of at least ₹200 crore expected to be generated in the remaining week or so in March, according to excise department data and officials.
After beginning the financial year on a poor note in the wake of the coronavirus-induced lockdown, the sales of liquor has garnered pace to beat the state government’s target of ₹22,700 crore.
“April (last year) was a wipe out but the sales have picked up since. We may get additional ₹200-300 crore till the end of this month,” an official from the excise department said, requesting anonymity.
The state had already exceeded its 2019-20 target prior to the March 24 lockdown last year. However, its revenues were reduced to ₹1.06 crore in April as against ₹1,302.84 crore in the corresponding month in the previous fiscal.
The state has witnessed a drop in the sales of both Indian Manufactured Liquor (IML) and beer without any overall impact on its revenues, data showed.
The sale of IML has declined from 561.70 lakh carton boxes (CBs) in 2019-20 to 524.75 lakh CBs in 2020-21, registering degrowth of -6.58 per cent. Likewise, the sale of beer dropped from 268.54 lakh CBs in 2019-20 to 204.67 lakh CBs in 2020-21, registering a decline of 23.78 per cent.
One CB of IML consists of 12 bottles of 750 ml of liquor. In case of beer, one CB is equivalent to 12 bottles of 650 ml.
“The sale of beer is expected to pick up with the onset of summer,” the official cited above said.
“Business is almost back to normal. Billing is also pretty much the same. Beer sales may pick up from now on,” a liquor retailer in Indiranagar, an upscale locality in east Bengaluru, said.
Lokesh, president of Bengaluru Wine Merchants association, attributed the dip in sales to the return of several migrants to their home town amid the pandemic.
“IML volumes are down by around 20% and beer is down by around 30%,” Lokesh said.
Unlike last year, the excise department is yet to push for more sales of IML over beer as the former offered better earnings in terms of volume ratio, retailers said.
The government exceeding its revenue target has come as a relief to the B S Yediyurappa-led state government that has been trying hard to ensure inflow of funds for its cash-starved reserves.
With very little taxes available with state governments under the Goods and Services Taxes (GST) regime, most of them are dependent on revenues generated from areas like excise, duty on petrol and diesel and vehicle registrations among others.
Karnataka has majorly been dependent on excise sales to fund its development programmes. Like other states, it is reeling under debt on account of higher borrowings from the Centre.
The high earnings of the state department are also on account of two hikes announced last year, that resulted in an overall increase of 17-25 per cent.
Unlike Delhi which announced an alcohol cess (later withdrawn), Karnataka chose to hike its taxes that resulted in additional earning of ₹2,500-2,600 crore, officials said.
The first hike that was announced during the Budget last year brought an additional ₹600 crore while the second one earned the government additional amount of around ₹2,000 crore, officials added.
