Corona Lockdown: Why Alcohol Sale Is Important?

Corona Lockdown: Why Alcohol Sale Is Important?

In India, liquor shops opened on the first day of Lockdown 3.0 today, there was a line of buyers across the country.

The sale of liquor has been started but the rest of the business is closed.

In such a situation, the question arises why the sale of liquor is so important for governments.

In fact, alcohol and petrol are the two products on which the state governments charge the most revenue by levying taxes according to their needs.

It is believed that liquor shops have been opened despite lockdown to reduce the fiscal deficit being incurred by the state governments.

But Excise Minister Ram Naresh Agnihotri in the Government of Uttar Pradesh does not agree with this.

Agnihotri says, "The convenience of people has also been taken care of in the decision to open liquor contracts."

On the question of social distancing, he says, "Police have been deployed to maintain law and order and social distancing of contracts."

Says Agnihotri, "The Uttar Pradesh government was losing a revenue of about three thousand crore rupees per month due to the sale of liquor."

Asked whether the government has opened contracts for the purpose of revenue collection, Agnihotri says, "Revenue collection is not only an objective but the needs of the public have also been taken care of."

In the year 2018-19, the Uttar Pradesh government collected a tax of Rs 23,918 crore from the sale of liquor.  At present, there are more than 18 thousand liquor shops in Uttar Pradesh itself.

To increase revenue, the UP government also implemented a new excise policy in January 2018.  Its purpose was also to break the monopoly in the liquor sales sector.

In the states where liquor is sold, fifteen to twenty five percent of the total revenue of the government comes from alcohol.  This is the reason that despite the lockdown, the state governments have shown haste in selling liquor.  UP, Karnataka and Uttarakhand derive more than twenty percent of their total revenue from the sale of alcohol alone.

However, in Kerala, Tamil Nadu and Maharashtra, the government gets less than 10% of the total revenue from the sale of liquor as the tax on liquor here is less than in other provinces.

Actually, liquor is excluded from GST.  That is, states determine taxes according to their own.  There is a ban on the sale of liquor in Gujarat and Bihar and the government does not get any revenue from liquor in these states.

In Andhra Pradesh, nearly three and a half thousand liquor shops are being opened from today, while new liquor ban tax is also being imposed.

However, the government has not yet set the tax rate.  State Special Secretary Rajat Bhargava said in a press conference yesterday, 'We are going to open liquor shops in the state due to revenue collection but the government is also worried about the ill effects of drinking alcohol.  Our Chief Minister is particularly concerned about the ill effects of alcohol and that is why we are going to impose liquor ban.  Its rate will be fixed soon.

He also said that Andhra Pradesh wants to completely stop alcohol in the long term.

Revenue concern

Rajat Bhargava said, 'All liquor shops outside the Containment Zone are being opened.  No shops will open inside the mall.

Sixteen big states of the country, excluding Gujarat, Bihar and Andhra Pradesh, had stated in their budget estimates for the financial year 2020-21 that they want to collect a total revenue of Rs 1.65 lakh crore from the sale of liquor.

Rajasthan had recently increased taxes to get more revenue from liquor sales.  The tax on foreign liquor (IMFL) of less than Rs 900 made in India was raised from twenty five per cent to thirty five per cent, while the tax on bottles worth more than Rs 900 was increased from thirty five per cent to forty five per cent.

Not only this, the tax on beer in Rajasthan was also increased from thirty five percent to forty five percent.  That is, if someone buys a hundred rupees of beer, then he pays forty-five rupees to the government.

On the first day of the lockdown, when liquor shops opened in Rajasthan, there was a huge crowd of buyers.  Some media reports said that the Rajasthan government may again stop the sale of liquor during the lockdown.

In this regard, when we wanted to talk to the Rajasthan government spokesperson and Health Minister Raghu Sharma, his representative said that no decision has been taken in this regard.

On the other hand, liquor shops did not open in Haryana on Monday.  The reason for this is believed to be a confrontation between the liquor vendors and the government.  Liquor shopkeepers are demanding a concession in license fees.

At the same time, the Manohar Lal Khattar government has decided to apply Corona cess from 2 to 20 rupees per bottle in Haryana.  Deputy Chief Minister Dushyant Chautala told reporters on Sunday that the government would impose Kovid-19 cess from two rupees to twenty rupees per bottle.

Meanwhile, in the capital Delhi, the police had to close some liquor shops due to congestion.  For the first time since the twenty-fourth March in the capital, liquor shops opened, crowds of customers thronged.

The drinkers have breathed a sigh of relief from the opening of liquor shops, while other business people say that when liquor shops can open, why can't their businesses open.