No tax hike in excise policy

Chandigarh, February 1

With no increase in excise and other levies, the prices of country liquor are set to remain unchanged in the “Excise Policy 2021-22” approved by the state Cabinet today. The price of the Indian Made Foreign Liquor (IMFL) may, however, see marginal increase depending upon the brand.

In the policy, the Excise Department has projected to mop up Rs 7,002 crore as excise revenue, as against current year’s Rs 5,794 crore, showing an increase of 20%. Overall, the policy largely focuses on providing relief to retail licencees and to keep buoyancy in the liquor trade.

The additional revenue will come through increase in the quota (minimum quantity to be sold by a licencee) of the IMFL, country liquor and beer by 6%, 12% and 6%, respectively.

A government functionary said the increase in quota would benefit liquor vends in border areas due to high consumption. For the first time, the department has proposed to impose a quota for foreign liquor in municipal corporation areas and class ‘A’ municipalities.

The government has offered a booster dose to the Covid-affected hospitality industry by cutting down on the annual fixed licence fee for bar and hotels by 30%. The fee on the consumption of liquor (assessed fee) has also been reduced. The annual licence fee for marriage palaces has further been reduced by 20%.

The policy aims at renewal of the existing vends, subject to lifting of additional liquor by the licencees, ensuring a minimum revenue growth of 12% during 2020-21. The current year’s revenue is expected to be Rs 5,794 crore as against Rs 5,027 crore in the previous year, showing an increase of 15%.

Further, the wholesale trade of liquor will be monitored online, replacing the present L-13 wholesale licencees. The conversion quota has been increased from 15% to 20%. — TNS

No tax hike in excise policy