Tipplers’ spirits sink as AP government raises tax on booze - The New Indian Express

Tipplers’ spirits sink as AP government raises tax on booze

Published: 01st December 2012 10:01 AM

Last Updated: 01st December 2012 10:37 AM

In news that is music to the ears of wives and anti-DUI (driving under the influence) crusaders like C V Anand and cash-strapped mavens in the Finance Department, liquor prices have been sharply hiked in the state.

Only beer, wine and ready-todrink tipples have been spared from the hike, which would range from Rs 10 to Rs 100 depending on the brand.

The new prices will come into force from Dec 1. The state government can expect to pocket an additional Rs 1,400 crore from tax on booze sales. And the tippling community as a whole is likely to be poorer by Rs 4,500 crore.

This is the sum of the two orders issued by the Excise Department revising the trade margin on raw Indian-Made Foreign Liquor (IMFL). One of the orders raises the trade margins and taxes from 15 per cent to 37 per cent.

By the other, the government has hiked the excise duty on liquor -- except beer, wine and ready-to-drink stuff.

Traders said there’s long process to be gone through before they can declare the new maximum retail price of each brand. Basically, the nip of liquor survives three whammies of VAT before it reaches the lips of tipplers.

 (1) As the trade margin has been increased on raw liquor, the VAT on it will have to be calculated anew.

 (2) Then, the manufacturer brings in the liquor and bottles it.

 At this stage, the government imposes excise duty and another dose of VAT on the bottled liquor.

 (3) Then, the Andhra Pradesh Beverages Corporation takes its cut and imposes yet another topping of VAT before delivering the goods to retailers

The new excise rat e would need a clear head to understand. Here goes

* If the basic price is up to Rs 350 per case, the new rate of excise duty will be Rs 47 per proof litre (which is the measure of alcohol content) or 85 per cent of the basic price, whichever is higher.

* If the basic price is Rs 351- 400 per case, the excise duty will be Rs 54 per proof litre or 90 per cent of the basic price, whichever higher.

 If the basic price is above Rs 401-450, the duty will be Rs 75 per proof litre.

* If the basic price is Rs 451- 600 per case, the duty will be Rs 83 per proof litre.

*In case the basic price is Rs 601-700 per case, the duty will be Rs 91 per proof litre.

* If the basic price is above Rs 701-850 per case, the duty will be Rs 95 per proof litre.

*If the basic price is above Rs 850 per per case, the excise duty will be Rs 100 per proof litre.

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