THIRUVANANTHAPURAM: Despite stiff opposition from within the Congress and the ruling front, the UDF government is all set to go ahead with its controversial budget proposal to reduce the sales tax on liquor with low alcohol content.
In an indication that there won’t be any immediate rollback of the revised taxes, the proposal has been included in the Finance Bill, the draft of which was published on Saturday.
The Bill is expected to be tabled in the assembly on July 1. The proposal to reduce the sales tax rate on low alcohol liquor from the current 251% to 120-175% had ignited a controversy, with the Opposition LDF alleging corruption behind the move.
The proposal had also met with opposition from within the ruling front as well. The introduction of a Finance Bill is the legislative process through which the assembly approves the imposition of new taxes or amendments to existing taxes.
Once the finance minister tables the Bill in the House, the proposed change in taxes comes into force, enabling the government to collect the revised taxes.
The draft Finance Bill proposes an amendment to Act 15 of The Kerala General Sales Tax Act, 1963. It proposes the insertion of a new category named ‘low alcoholic beverage’. It also proposes two tax structures for such categories of beverages.
While those having alcohol strength between 0.5% to 10% v/v will be taxed at 120%, beverages with alcohol strength between 10% to 20% v/v will attract 175% tax.
Call to roll back new tax proposals
Notably, Congress veteran V M Sudheeran had sought a reversal of the new tax proposals and demanded that they should not be included in the Finance Bill.
Meanwhile, the government attempted to quell the opposition by asserting that the decision on selling low-alcohol beverages in Kerala will be based solely on the liquor policy, which is yet to be prepared.
Excise Minister M Liju had said the tax cuts do not indicate permission for the immediate sale of low alcohol beverages. The minister also clarified that the tax slabs will come into effect only when the sales happen in the future after the liquor policy comes into force.
In Finance Bill
The proposal to reduce the sales tax on liquor with low-alcohol content has been included in the Finance Bill.