THIRUVANANTHAPURAM: Amid a shortage of liquor from inexpensive brands, with major suppliers having stopped the sale of cheap brands to the Beverages Corporation demanding a price hike, the state government is yet to take a decision on the matter. Besides allowing a price hike, the suppliers have asked the government to do away with the turnover tax. The issue of advance tax payment too has not been resolved. Last year, Bevco had stopped advance payment of excise duty for liquor purchased from companies.
Pricey brands on rack; Customers suffer, Beverages corp mints money
This followed an adverse opinion in the CAG’s audit report. The report had pointed out that the practice was against Excise rules. Following a protest by the suppliers, the government decided to continue advance tax payment by Bevco until this month. In the new financial year, most of the suppliers have not participated in the tender process for supply, said a source. Some others who signed contracts have agreed to supply expensive brands.
Meanwhile, the corporation’s revenue has increased as customers are forced to buy expensive brands. April alone saw a rise of `404 crore. On Friday, Excise Minister M V Govindan said the rise in the price of Extra Neutral Alcohol (ENA) has put manufacturers in difficulty. The price of one litre of ENA rose by up to `7, he said, hinting at a hike in prices.
The minister said the Travancore Sugars and Chemicals, the only state-run distillery in Kerala, has cut short production. It has just one product, Jawan Deluxe XXX Rum, which is a popular inexpensive brand.
The company is suffering a loss of `3.50 per bottle due to the ENA price rise, he said. Currently, expansion is under way at the Tiruvalla-based distillery. The plan is to set up an additional six production lines there. It is expected to increase the daily production from an average 7,000 cases to 10,000-12,000 range.