UP unveils new excise policy: With small 100 ml packs, govt targets extra big revenue

While rationalising MRP formulas for Indian-made wine and low-alcohol beverages (RTD), excise duty on wine has been reduced. Fortified wine will be charged excise duty at an additional rate.

Against excise-duty-free wine, a total monthly/quarterly adjustment in MGR up to 0.1% will be permissible. A minimum increase has been made in the special additional excise duty on Indian Made Foreign Liquor (IMFL).

The working hours of retail shops will remain unchanged, i.e. from 10 am to 10 pm.

Shop allotment and renewals

Under the new policy, composite shops, model shops, premium model shops, retail shops of country liquor, and hemp (bhang) will primarily be managed through renewal after receiving applications. On the e-lottery portal, a processing fee of Rs 3,000 has been fixed for applications related to mobile number correction, PAN correction, etc. This arrangement will be applicable from the date of notification of the Excise Policy for 2026–27.

Licence fees

In the interest of revenue and administration, the annual Minimum Guaranteed Quantity (MGQ) of country liquor shops arranged in 2025-26 will be increased differently area-wise. The monthly distribution of annual MGQ will be done on the basis of varying percentages, considering demand/consumption in different months. Transfer of MGQ up to 30% between country liquor shops will be permissible.

A shop will be permitted to lift only up to a maximum of 75% of its monthly MGQ from any one distillery (including all Country Liquor Bottling-1 and CLB-2 units of that distillery).

The MGR / license fee of liquor retail shops has been increased by 7.5%. The license fee for bhang shops shall be increased by 10%.

Grape wineries established in the state will be permitted a maximum of two V-5 licenses per district.

For the financial year 2026–27, the provisions related to liability of license fees for CL-2 (country liquor), FL-2 (foreign liquor), and FL-2B licenses have been modified.

The authority to change the location of retail shops (shop relocation) has been vested in the Licensing Authority (District Collector concerned).

Mandatory premium stock in urban areas

In all municipal corporation areas of the state and in Gautam Budh Nagar district, it will be mandatory for model shops and premium model shops to procure at the shop — imported liquor equivalent to at least 5% of their prescribed monthly Minimum Guaranteed Revenue (MGR) and premium and high-category IMFL equivalent to at least 2% of MGR.

Similarly, all premium retail vends should procure at the shop — imported liquor equivalent to at least 5% of minimum MGR and super premium and high-category IMFL equivalent to at least 2% of minimum MGR.

The definitions and standards (alcoholic strengths) of various alcoholic beverages as defined and amended from time to time under the Food Safety and Standards (Alcoholic Beverages) Regulations, 2018, shall be adopted as is for the purposes of the Uttar Pradesh Excise Department.

In Gautam Budh Nagar district and all municipal corporations, Low-Alcoholic Premium Retail Vend licenses may also be granted for the sale of wine and LAB (low alcoholic beverage)/RTD (ready to drink).

In the districts of Gautam Budh Nagar, Ghaziabad, Agra, Prayagraj, Varanasi, and Lucknow, bar licenses (Form FL-7(1)) may also be granted exclusively for low-alcohol strength beverages, beer, wine, and RTD. At every level of the liquor supply chain, deposit of revenue and all other financial transactions will be mandatorily conducted through the online portal.