State govt slashes excise duty on imported foreign liquor by 50%

The Maharashtra government has slashed excise duty on imported foreign liquor by 50 per cent to curb inter-state smuggling and bring the prices of imported liquor on par with those of other states. State government officials said the measure was expected to increase the government’s revenue by Rs 150 crore in a year.

State excise department officials said that excise duty on imported whisky, brandy, rum and vodka has been brought down from 300 per cent to 150 per cent of the manufacturing cost. “We expect that the sales will go up from the current 1 lakh cases per year to 2.5 lakh cases per year. The revenue is expected to increase from Rs 100 crore to Rs 250 crore,” said Valsa Nair Singh, principal secretary of the state excise department.

The excise reduction will apply only to imported liquor brands bottled and packed in the country of origin, and not to those international brands that are bottled in India. It also does not apply to Indian Made Foreign Liquor brands. The new excise rates have come into effect from the date of the notification, on November 18, Nair told The Indian Express.

According to officials, the cut in excise duty would help boost declining sales of imported whisky in Maharashtra. The state government has been earning revenue of Rs 100 crore each fiscal since 2019-20, which is half of its revenue in 2018-19 from the sale of imported whisky. The excise rates were increased in January 2019.

Officials said the decline in revenue was due to high taxes on imported whisky. In fact, Maharashtra had among the highest excise duty on imported whisky of 300 per cent as compared to neighbouring states. Now, with the new notification, the excise duty has been brought on par with the other states.

A senior official said that due to the exorbitant prices of imported liquor in the state, there was a lot of smuggling and black marketing from other states such as Goa, Daman, Delhi, Chandigarh and other places. “Our vigilance squad has been taking action on the smuggling and black marketing of imported liquor. A survey by our department also revealed the huge smuggling and black marketing. So, we have decided to slash the excise duty. Now, we hope that sales will go up,” said an official from the state excise department.

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