5 min readChandigarhJun 9, 2022 03:15 PM IST
First published on: Jun 9, 2022 at 03:14 PM IST
Setting a target of generating revenue of Rs 9,647.85 crore from liquor, at least 40 per cent more than last fiscal year, the Punjab government has allowed sale of unlimited quota of beer and Indian made foreign liquor (IMFL), thereby making these cheaper by 30% to 40%.
The Punjab Cabinet Wednesday gave its nod to the first excise policy of the Aam Aadmi Party (AAP) government in the state. The quota of Punjab medium liquor (PML), however, remains the same as last fiscal year at 6.03 crore proof litres for nine months, from July 1, 2022, to March 31, 2023. In case of PML, a case of 12 bottles carries 4.5 proof litres of liquor.
The move behind making the beer and IMFL cheaper is to stop smuggling of liquor from neighbouring states and thereby stop the loss to the state exchequer. The competition among the liquor dealers is expected to lead to lowering of prices of liquor.
The government has also slashed the excise duty on liquor considerably. The excise duty on all kinds of liquor except PML shall be charged at the rate of 1 pc of the wholesale price at wholesale stage. Excise duty at the rate of Rs 53 per PL, Rs 107 per PL and Rs 107 per PL shall be charged at retail, wholesale and manufacture levels respectively for PML. However, this would be part of the total licence fee of the group.
The excise duty has been slashed by 350 per cent on PML, which is 150 per cent now. It has been slashed by 250 per cent in IMFL, which is at 1 per cent now. Excise duty on all kinds of liquor except PML shall be charged at 1 per cent of the wholesale price. On the same pattern, assessed fee of IFL shall also be charged at 1 per cent of the wholesale price. The prices of liquor shall now be almost on a par with the neighbouring states.
The new excise policy also stipulates to tap the actual potential of liquor trade by allotting 177 groups through a free, fair and transparent manner of e-tendering. The policy has made the general size of the group bigger at Rs 30 crore. The number of vends has not been increased. It is at 6,378 vends in the state of Punjab. Not more than 10 sub-vends are being allowed.
Another step taken by the government — a bone of contention between the government and the liquor contractors — is that the number of L-1 licences has been decreased considerably. Now largely, only one L-1 licence would be given in a district. Earlier, there were 80 L-1 licence holders. Now there would only be 25-30 L-1 licence holders. “That too, we will not provide L-1 licence to a manufacturer or a retailer. The L-1 will only be a wholesaler. This means that none can engage in malpractices. All the three types of dealers have been isolated. Also, one company can only keep a single L-1 licence.”
With the state government aiming at a revenue jump of 40 per cent, a government functionary said, “We are hoping to make this much revenue jump this fiscal year. If all goes well, this will be done.” During the last two years, the state has witnessed 20 per cent increase in revenue every year.
The AAP has been promising the electorate in the state that it would increase the revenue from liquor in the state. If the government is able to meet the target then it will touch the figure of about Rs 10,000 crore from liquor.
A government statement after the Cabinet meeting said that the policy strives to keep a stringent check over smuggling of liquor from the neighboring state through extensive enforcement and by incorporating new technological measures. The excise policy aims to collect Rs 9,647.85 crore in the year 2022-23. This policy shall be applicable for a period for nine months, i.e. 01-07- 2022 to 31-03-2023.
Meanwhile, the Cabinet also gave nod for allotting two special battalions of police to the excise department, in addition to already existing force, for keeping an effective vigil over the excise duty pilferage. This will also help in keeping a better check over the supply of illicit liquor into Punjab from the neighbouring states.
The new excise policy aims to break the nexus of mafia involved in liquor trade. Accordingly, the manufacturer, wholesaler and retailer, shall be isolated. They shall be completely isolated from each other with no common stakeholder between the above entities.
To encourage capital investment and to increase the employment capability in the state, provision for new distillery licence and brewery licence have been made in the policy. Further, a new licence for the production of malt spirit has been introduced in the state. This has been done to encourage crop diversification and to provide better remuneration to the farmers.
BJP leader Manjinder Singh Sirsa accused the AAP government of replicating the Delhi excise model to benefit a few. “@Aam AadmiParty is abusing Punjab state machinery & replicating Delhi model of excise in Punjab to benefit a selected few,” said Sirsa in a tweet.
The move behind making the beer and IMFL cheaper is to stop smuggling of liquor from neighbouring states and thereby stop the loss to the state exchequer. 
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