BENGALURU: Prices of premium liquor in Karnataka will come down drastically from July 1. As announced in the budget by Chief Minister Siddaramaiah, the state government issued a draft notification on Thursday, on rationalisation of tax slabs on premium liquor, to make them competitive with the neighbouring states and to bring buoyancy to the sector.
According to the notification, the new prices will come into effect from July 1. The excise department has invited objections, if any, for reduction in excise duties on 16 categories of high-end liquor. Sources in the government said, from July 1, prices will come down from Rs 100 to Rs 2,000, depending on the brands. “Prices of brandy, whiskey, gin, rum, and other such liquor - except beer, wine, toddy and fenny - will come down,” a source said. Exact reduction will depend on the brand and the quantity.
According to the official, except for some brands which are cheaper, prices of all other liquor are much higher in Karnataka. “Since liquor prices are much cheaper in the neighbouring states, we are losing out on revenue. The rationalisation of tax slabs will help increase the tax revenues by almost double in the next 2-3 years. Although there may be a slight dip in revenues in the short term, the proposed move will increase volume of sales resulting in better tax mobilisation,” the official said.
Alcohol in Karnataka is priced and taxed according to its slab. There are 18 slabs, with the cheapest alcohol falling in the first and the most expensive IML in the 18th. Top brands of IML are priced much higher in Karnataka than in other states because of various reasons, including high taxes. The cost of a premium brand of Scotch whiskey is around Rs 7,000 in Karnataka, whereas it is much lower in other states.