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The state finance department is expected to issue a fresh order today announcing the reduction in the proposed increase in excise duty on ENA used for making fortified wine from 177% to 57% as notified on June 22, according to state Excise Commissioner S.R. Umashankar, as reported by TOI.
In a unilateral decision without consulting stakeholders, especially growers and wineries, the government had notified on June 22 a whopping 177 percent increase in excise duty and additional excise duty on a bottle of wine with effect from July 1. They were asked to file any objections. As expected the Karnataka State Wine Producers' Association had immediately protested, taking the injustice being done also to media space. A report was published by delWine also.
"We have filed objections to the steep excise hike on fortified wine produced from blue variety of grapes by hundreds of growers across the state and threatened to lower production 50 percent if the hike was not reversed, as we cannot compete with wines from other states and overseas (French variety)," president P.L. Venkata Rama Reddy had told IANS which published this news report yesterday.
In its objections, the association, representing growers and about 20 wineries in the state, said the steep hike would have a bearing on the production cost for growers and farmers, as the wine variety Bangalore Blue/purple was grown throughout the year (unlike grapes used by the premium wine producers who use the wine grapes that are harvested only once a year).
Claiming that this is a wine grape variety not grown anywhere else in the world, Mr. Reddy reportedly says, “The blue grapes our farmers grow in the state, especially around Bengaluru, are not grown anywhere in the world. As they grow only wine-making variety, the crop is cultivated and harvested every three months unlike fruit and other variety of grapes, which are seasonal the world over."
The state-run Karnataka Wine Board supported the protest by the Association. "As the state government wants to promote wine consumption and encourage growers to produce more fortified wine variety of grapes, the 120 percent reduction in the hike would minimise the additional burden on them," says Mr T Somu, Board Secretary, according to the report.
Being the only variety of grapes grown round the year - in about 23,500 acres of land across the state, mostly in Chikkaballapur, Doddaballapur and Devanhalli, the central government has also issued a geographical indication (GI) tag to the Bangalore Blue grapes in 2013.
‘We welcome the reduction and hope to absorb the modest hike of 57 percent, as the levy will go up to only Rs.27 per litre from Rs.17," says Mr. Reddy. |