Karnataka Hikes Excise Duty On Liquor By 11% Amid Lockdown Relaxation

This hike is in addition to the six per cent that was announced in the budget, Chief Minister BS Yediyurappa told reporters in Bengaluru.

Karnataka Hikes Excise Duty On Liquor By 11% Amid Lockdown Relaxation

Karnataka sold liquor worth Rs 231.60 crore on Wednesday (Representational)

Bengaluru:

The Karnataka government on Wednesday hiked the excise duty on liquor by 11 per cent to mop up revenues, two days after allowing its sale amid lockdown relaxations.

This hike is in addition to the six per cent that was announced in the budget, Chief Minister BS Yediyurappa told reporters in Bengaluru.

According to sources, the hike will translate into a consumer paying Rs 5 more for an 180 ml bottle of liquor.

The hike is applicable on brandy, whisky, gin and rum, but not on beer, wine, toddy and feni, they said.

The government had allowed retail shops and state-run retail shops such as MSIL (Mysore Sales International Limited) to sell liquor between 9 am and 7 pm only in areas that are outside the COVID containment zones from May 4 onward.

Spirits worth Rs 231.60 crore were sold on the third day of liquor sales in the state on Wednesday.

According to top Excise Department officials, 39 lakh litres of Indian-made liquor worth Rs 216 crore and 7 lakh litres of beer worth Rs 15.6 crore was sold on Wednesday.

On the first two days - Monday and Tuesday - liquor worth Rs 45 crore and Rs 197 crore was sold respectively.

Responding to criticism by certain sections, claiming lack of preparation before allowing liquor sale, Mr Yediyurappa said, "When there are people to drink, what preparation is needed?"

State Excise Minister H Nagesh had recently pegged the losses at Rs 60 crore per day because of closure of liquor shops due to the lockdown.

With excise alone accounting for about 18 per cent of Karnataka's own tax revenue, the move is aimed at improving its precarious finances that has been further affected due to the lockdown.

In the 2020-21 budget, the government had increased Additional Excise Duty on IML (Indian Made Liquor) by six per cent across all 18 slabs and had fixed the excise department's revenue target at Rs 22,700 crore for the 2020-21 fiscal.