Liquor to get costlier in Maharashtra from January 1 as state hikes excise duty
Liquor will cost more from 2019 as the Maharashtra government hiked the excise duty, which will come into force from January 1. The hike will be in the range of 4-25 % and is expected to garner the state government an additional revenue of Rs 500 crore annually.
The major hike will be for premium and mid-sized Indian Made Foreign Liquor (IMFL) in the range of 20-25 % while small brands will face a hike of just 5 %.
Foreign liquor brands will face a duty of around 4% now.
The state government on Monday issued a notification to amend the Maharashtra Potable Liqour Rules, 1996 to make way for this hike.
Justifying the hike, an excise department official, who did not want to be named, said that the duty has been raised after five years and nine months. “We have hiked the duty after a detailed study. This should not add too much of a burden and things will stabilise in the coming months,” he said. The official explained that some brands such as Antiquity, Royal Stag, Teachers and VAT 69, going by their current manufacturing costs, were likely to see a bigger hike.
Some of the smaller brands like Haywards and Bagpiper, however, would not see much of a price hike. “We have deliberately kept the low segment IMFL and foreign liquor taxes low as this would have encouraged more smuggling from neighbouring states like Goa and Daman,” he added. The reason was that the price difference between the states is very high and this encourages many to smuggle from other states.
However, liquor shops are not happy with the hike saying it will hurt their business. “Our daily turnover will reduce by this move and it will also hit our profits,” said a senior office bearer of Association of Progressive Retail Liquor Vendors, who also did not want to be named.
The state government gets Rs7,000 in revenue as excise duty annually. With the state’s finances under a severe crunch due to a farm-loan waiver, seventh pay commission and recent removal of surcharge on fuel, the state is hoping that this duty hike can make up for the losses.