The pressure by the state assembly and the central government has made the local government take a decision to start issuing permits for leading brands of wine and spirits. It is learnt that the first order has gone to Brindco- the Delhi based leading importer. Supplies are expected to reach the market at an air-speed and the products are expected to be available as early as Monday on the retail shelves..
The scotch lovers would celebrate the decision by buying a Black Label for Rs.3600 or the Red Label at half the price in the liquor stores. Albert Bichot VDP Merlot would retail for as low as Rs.1200. These prices include the imported duties, local duties, 24% margin of the state owned monopoly distributor TASMAC (Tamilnadu State Marketing Corporation) and 58% local sales tax.
WTO has three major states against whom they have an issue, apart from the heavy excise duties being charged by Maharashtra and Karnataka etc., making the total duties more than 150%, the outbound limit as agreed by India. Tamilnadu and Kerala are the two major states not allowing the sale of imported wines and spirits. Kerala had in fact issued a tender for spirits in February this year but reportedly no action has been taken so far, perhaps pending the results of the case in the WTO.
A senior delegation from WTO is coming to India later this month to address the issues arising out of these states and the agreement. The government of India is very keen to settle the disputes, Article 147 giving the states autonomy in alcohol taxation and policy notwithstanding. Informed sources have even informed delWine that the government has perhaps willingly let the case be won against it to help it solve the problem pending since July 2007 when the additional duties were waived and it brought the customs duties to the 150% level as agreed with WTO.
Contrary to reports in most mainstream dailies, Indian Wine Academy is of the firm opinion that the total duties should be brought down to 150% and the government will have to use all its might to make it happen not only to save an embarrassment but also the heavy penalties that can be imposed by WTO under the existing agreement. It might want to buy time as the general elections are approaching. But the writing is clear on the wall. The states must open up and duties brought down to the levels agreed to. In the end, the customer would be the one to benefit and the states will not lose on the revenues.
Subhash Arora |