Excise: Chandigarh Policy favourable for Wine and Beer

The new excise policy for 2019-20 for the Union Territory seeks to promote beverages with low alcoholic content by scaling down the prices of beer and wine while increasing the price of country made liquor and Indian Made Foreign Liquor (IMFL). In another reform, licensing units will now be allotted through e-tendering. It will also be mandatory for all the retail licensees to issue an invoice on sale of liquor.

Another positive feature is that it makes it mandatory for all bars and restaurants to install alcometers in a bid to check dangerous drinking. At least to begin with, the alcometers will be made available to consumers for voluntary assessment of alcohol level. However, a hotelier reportedly says, “We have already installed them as per the administration’s recommendations earlier, but no one uses them.” This could be Administration’s way of getting a step closer to oblige the customers undertake the test and punish restaurants who let the levels go unchecked and serve liquor to those at levels higher than prescribed, opines delWine while at the same time, ensuring that working alcometers are in fact available at all restaurants. Voluntary advice does not always work in the Indian environment.

The administration still hopes to increase its revenue by 18 per cent from Rs.5.1 billion (Rs 510 crore) last year to around Rs 600 crore in 2019-2020 based on higher duties on liquor.

Boost for microbreweries

With the same objective of encouraging low alcoholic products, the excise duty on microbreweries has also been reduced from Rs 50 per bulk litre to Rs 30 The license fees of microbreweries, restaurants, pubs and bars has also not been increased from last year. To promote sale of imported and Indian wines, ready to drink (RTD) products and imported beer, the licence fee of the licence L-2D for shops remains unchanged at Rs 200,000.

It would be unfortunate for the consumer, if the Liquor vend owners pocket the decrease in wine costs as they have already stated that not much change would be observed in the wine rates and relaxations will only encourage more varieties of wine. The administration could go right back to the last year’s policy with no sympathizers.

Ease of doing business

For the first time in Chandigarh, the allotment of liquor vends will be made through e-tendering. Besides ensuring transparency, the system will allow issuance of permits online to facilitate trade and industry.

Haryana excitement building up

Meanwhile, the excitement in Haryana is building up for wine and liquor stakeholders, perhaps more than the General Elections in the State which are being held in stages in April-May 2019. The potential bidders are keeping their cards close to them with various alliances being built up including benami companies coming up in order to increase the probability of cornering maximum licenses, according to our sources.

Theoretically, one applicant could bid in 4 or more different names to ensure cornering of all 4 of L1-BF licenses. The parties interested in having a fair share of the licenses allotted are not willing to disclose their cards, as the stakes are very high. But the sources tell delWine that due to plugging in various loopholes, it is getting more and more difficult to have bumper profits in Haryana, especially in the areas of VAT etc. and it is going to be very optimistic to expect a good return on investment with fair business practices. Some people interested in bidding earlier reportedly may not even bid anymore.

Things would be clearer before the month is out. Both the policies are effective from April1. As always, it would be a big surprise if Delhi policy is announced on time. Usually it is delayed by up to 6 months, keeping uncertainly alive on a month to month basis.

For our previous related Article, please visit:

New Haryana Excise moves from Monopoly to Oligopoly

If you Like this article please click on the Like button