A panel of experts formed by the Delhi government has recently recommended a few changes that could lead to an increase in liquor prices to around 50%. It is expected that the new prices might be a major threat for small and medium booze manufacturers as the committee recommended to abolish rum and whisky brands which are sold below Rs 140 to ensure that quality products are sold.
Delhi government is planning to introduce changes in the format of retail sales and hike the excise duty on liquor which, in turn, could push liquor rates to an all-time high in the capital territory.
As per the media reports, Delhi government formed an expert panel that has recommended an increase in the liquor prices. However, it has also proposed to raise its revenue from Indian liquor, foreign liquor and country liquor (from Rs 5,000 crore to approx. Rs 8,000 crore).
As per a report “The state government at gets excise revenue of Rs 46 crore from brand registration, Rs 4,507 crore from Indian liquor, Rs 240 crore from foreign liquor, Rs 210 crore from country liquor, Rs 170 crore from licence fee from restaurants and bars servings liquor, Rs 300 crore from export and permit fees and Rs 40 crores from retail licences. This sums up to Rs 5,068.70 crore. However, the Delhi government is keen to increase to nearly Rs 8,000 crore.”
Furthermore, the panel proposed to reduce the number of dry days in Delhi to attract buyers who visit the neighboring areas of Noida and Gurugram to buy liquor.
Lowering the legal drinking age in Delhi to 21 is also suggested by the committee along with the extension in the timings of restaurants serving liquor.
In the post-GST scenario, states have the authority on very limited areas to levy taxes, ie., VAT on petroleum products, excise duty and VAT on liquor for human consumption, stamp duty on real estate and tax or duty on electricity.
