Liquor to get cheaper in Delhi post introduction of new clause in excise policy

 Cheers, Delhiites. A quart of Chivas Regal or Johnnie Walker Black Label is likely to cost at least Rs 400-500 less, or 20-25 per cent lower, in Delhi — which is arguably the country’s largest market for imported spirits and wines.

The reduction in prices was possible after the introduction of a new clause by the Delhi government in its excise policy. As per the clause, the importer and distributors have to give a declaration that the prices of liquor sold in the Capital are the lowest in the country.

Officials said the clause was included to ensure that the difference in retail prices of these brands in Delhi and its neighbouring states is marginal so that consumers do not buy liquor from places like Haryana, where booze is cheaper.

Due to higher base rate, excise duty and other taxes, the price of liquor, especially foreign brands, is higher in Delhi. An excise official, however, said that importers have so far kept the base price of high-value brands higher because the excise and other duties are calculated on base price, which makes the retail price automatically higher.

Since importers have to register their brands of liquor every year, the excise department has made it mandatory for them to submit an affidavit at the time of registration declaring that the wholesale price as submitted for price fixation in Delhi is the lowest anywhere in India — net of all discounts, commissions and rebate.

“The new brands were so far calculating the hit in profits they would have to take by lowering the base price, thus delaying the registration process. But now, brands have been registered,” said an official. “Due to delay in registration, some brands were not available in the market, but we expect the resto-bars to now pass on the benefits to customers ahead of Diwali”.

In accordance with the new rates of taxation, a quart or 750 ml of Absolut Vodka will cost Rs 1,400 instead of the usual Rs 1,800. Similarly, Ballantine’s Finest 750 ml bottle will cost Rs 1,350, cheaper from Rs 1,800 and Chivas Regal will cost Rs 2,800 rather than Rs 3,850 with importers reducing the base price on these brands.

Amrit Kiran Singh, executive chairman, International Spirits and Wines Association of India, however, opined that the government needs to take a balanced approach if it really wants to bring the prices of liquor in Delhi at par with other states.

“This move could see companies de-listing high-value products and supplying only moving brands because of lower profit margins, given the higher excise duty in Delhi as compared to other states. The government should co-create policy after discussing with industry experts, and slash the big elephant in the room — the excise duty,” Singh said.

Move ensures liquor rates are marginal

Due to higher base rate, excise duty and other taxes, liquor prices are higher in Delhi. The new clause ensures the difference in liquor prices between Delhi and neighbouring states are marginal
A quart (750 ml) of Absolut Vodka will now cost Rs 1,400 instead of Rs 1,800. Similarly, a bottle of Ballantine’s Finest will cost Rs 1,350, cheaper from Rs 1,800 and Chivas Regal will cost Rs 2,800 rather than Rs 3,850 with importers cutting the base price.