Less vends, group sizes slashed in the new excise policy of Punjab in order to finish monopoly

The new policy aims to reduce the number of liquor vends, slashing the group size from Rs 40 crore to Rs 5 crore, thus increasing the number of groups from the current 84 to around 700 in the next FY

Published: 13th March 2018 08:45 PM  |   Last Updated: 13th March 2018 08:46 PM   |  A+A-

liquor, Alcohol

Image for representational purpose only.

Express News Service

CHANDIGARH: The new Excise Policy for Punjab, with the aim of breaking the monopoly in the
liquor business and keeping liquor prices under control was today approved by the state cabinet.

The new policy aims to reduce the number of liquor vends, slashing the group size from Rs 40 crore to Rs 5 crore, thus increasing the number of groups from the current 84 to around 700 in the next fiscal.

Allotment is proposed to be done through draw of lots to bring greater transparency, which has been drawn out in consultation with various stakeholders and is focused on breaking the monopoly in the business.

The Excise Policy for 2018-19 got the cabinet. The government is hoping to earn Rs 6000 crore during the next fiscal from the liquor business under the new Excise Policy. For the current fiscal, the
Excise Department expects to collect Rs 5150 crore by the end of financial year, as against the Rs 4400 crore collected during 2016-17.

Chief Minister Capt Amarinder Singh has directed the Excise Department to strictly monitor the policy implementation to ensure that there is no deviation in the collection of the projected revenues.

The Group size, under the new Policy, has been kept very small – at Rs 5 crores only - with variation up to 25 percent to enable sufficient competition in the market, leading to reduced prices. The rate of application has been fixed at Rs.18,000 (including GST, if any).

Besides, to streamline the business, the number of liquor vends will be reduced from 5850 to 5700.

Further, under the new policy, the quota of PML has been reduced from 8.44 crore PLs to 5.78 crore PLs (-32 per cent), of IMFL from 3.71 crore PL to 2.48 crores PLs (-33 per cent) and of Beer from 3.22
crore BLs to 2.57 crore BL (-20 percent) under the Minimum Guaranteed Quota. Each license will be granted on a Minimum Guaranteed revenue basis, which will consist of fixed license fee and excise duties chargeable on minimum guaranteed quota.

The licensee will be liable to pay such minimum guaranteed revenue even if he does not lift the quota
allocated to his license. Settlement will be on monthly basis, which will also help in removing the supply of excess liquor to bootleggers.

The Policy also provides that leftover excess quota of 2017-18 be carried forwarded in Minimum Guaranteed Quota of 2018-19, subject to payment of Excise Duty for 2018-19.

Under the provisions of the policy, a fixed license fee will be chargeable at the time of grant of license. This will be fixed by the Collector-cum-DETC depending upon the quota of the Group and location of vends.

Also, Excise Duty has been levied instead of License Fee, Special Development Fee, Extra License Fee as part of the new Policy.

The rates of Excise Duty on PML, IMFL and Beer have been fixed at Rs.318  per PL, Rs.348  per PL and Rs 52 per BL respectively from wholesaler to retail stage. Similarly, Excise Duty on PML has been
levied @ Rs 35 per PL and on Beer, Rs.60  per BL for strong beer and Rs 57 for light beer. On IMFL liquor, Excise Duty ranging from Rs 84 to Rs 390 has been charged depending on the EDP of the brand. The EDP of PML has been fixed at Rs 254  per case, as against Rs 240  per case fixed last year.

Abolition of Uchanti system and charging of only minimum retail prices of liquor from liquor vends for functions to be held in marriage palaces halls are among the other features of the policy.

Meanwhile, it has been proposed that instead of levying Cow Cess on per bottle basis in urban areas only (as has been done by some MCs), special license fee @ Rs 5 per PL on PML and IMFL may be levied both in urban areas and rural areas so that equal rates of liquor are maintained in the market.  The fund so collected will be used for upkeep of Cows in urban areas.

Similarly, the fund will be used for the welfare of livestock in rural areas alongwith on education and health services, swachhta abhiyan. The proceeds of the special license fee will be deposited in the treasury and the Department of Finance will transfer requisite funds to the concerned departments.

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