Prices of premium brands of liquor are set to increase while that of beer will come down as a result of the changes in the Excise Policy for 2014-15, announced by the Chandigarh Administration on Monday.
The administration reduced the quota of liquor, which was a major demand of the contractors, and also reduced the number of vends.
Deputy Commissioner Mohammad Shayin said, “Liquor prices in Chandigarh are now on a par with Punjab while Haryana has lower rates.The quota of liquor has been reduced. This would reduce smuggling to the adjoining states as the quota was too high to be consumed in the city. The new policy will also ensure that the small shops that were not being auctioned will find takers.”
Excise duty on Indian Made Foreign Liquor (IMFL), draught beer, imported liquor and wine was increased by 10 to 25.50 per cent on different categories while excise duty on bottled beer was reduced by 50 per cent, and that on cheap segment of IMFL by 17 per cent.
On country liquor, the duty was kept unchanged.
Other excise levies on liquor were increased by 33 per cent to 50 per cent, and the assessment fee leviable on liquor vends reduced by 33 per cent.
For the first time, an export fee at the rate of Re 1 per bottle was introduced; it will be levied on all brands of IMFL.
Assistant Excise and Taxation Commissioner R C Bhalla said, “The prices of high-end brands will increase by 15 to 20 per cent while those of the cheap brands will reduce by the same amount. The export duty has been imposed with the aim of generating revenue.”
The administration decreased the number of retail vends from 217 to 173. The number of country liquor vends was reduced from 65 to 50 while that of IMFL vends was reduced from 152 to 123.
Last year, the administration had closed down liquor vends and taverns operating from structures along the roadside, but the total number of vends was not reduced.
Conceding a vociferous demand of the liquor contractors, the administration reduced the overall quota of liquor to be lifted by 50 per cent.
For country liquor, the quota was reduced from 27 lakh proof litres to 10.82 lakh proof litres. For IMFL, it was reduced from 200 lakh proof litres to 82.83 lakh proof litres. The quota will be distributed proportionately amongst the vends, keeping in view their licence fee.
A major grouse of the liquor contractors with the previous policy was that the quota was very high, and they could not sell it and had to suffer losses.
The policy will remain in effect for a period of 10 months from June 1, 2014, to March 31, 2015.
The policy for the last financial year was to end on April 30, 2014, but an extension of one month was given as the new policy was not ready because the administration was busy with the Lok Sabha election, although the Election Commission had given its go-ahead. Despite the extension, as many as 26 liquor contractors had surrendered their vends, causing loss to the Excise Department.
If the highest bidder surrenders, second highest stands to gain
In order to ensure liquor vends do not remain unsold due to cartelisation, the administration has decided that if the highest bidder surrenders a vend after the auction, his earnest money would be forfeited and the vend offered to the second highest bidder. Last year, the contractors had formed cartels. To ensure their monopoly, a contractor would bid a very high amount for another vend in the same sector. Later, the contractor would surrender the vend. Due to this, several vends were left unsold. The Excise Department organised multiple auctions, but in vain.