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The Andhra Pradesh government has asked liquor manufacturers to ensure 25 per cent of the supplies in tetra-packs and 90 ml bottles. The move is aimed at making liquor affordable for the lower economic strata as they are going for a much cheaper and often hazardous alternatives such as ID liquor.
“As there are no distilleries in AP, we have asked manufacturers to produce liquor sachets and smaller bottles at facilities in other states and supply to our market before setting up their own distilleries the state. It may take a couple of months to bring these tetra-packs into the market,” a senior government official told Business Standard.
Over 60 per cent of the Indian-made foreign liquor (IMFL) sold in AP and Telangana is of the lower category with an 180 ml bottle costing around Rs 60, according to wine dealers association president Venkateshwar Rao. The sale of liquor in smaller size containers is expected to make it affordable to more people and keeping them away from ID liquor. This may result in higher revenues for the government as well, according to officials. However, the actual impact of this move will be known only after the tetra-packs and 90 ml bottles enter the market, they said.
Last year, the state exchequer made around Rs 12,000 crore revenues from sale of liquor through various forms of taxes and duties. The revenue department had estimated an additional revenue of over Rs 1,000 crore in the current year but it is expected to surpass expectations and even go beyond Rs 2,500 crore going by the industry feedback, according to the officials.
The state government also took measures to arrest revenue leakages in the recently announced excise policy, which will be in force for a two-year period starting June. Under the new policy, the government had kept 10 per cent of the 4,300 retail outlets in the state aside for running them with government agencies to ensure that the liquor is sold at the maximum recommended price by private retailers. The government had also removed the volume restrictions under which if any retailer sold liquor beyond seven times of the value of the licence fee, he was asked to pay 14.5 per cent duty on the additional income.
As the volume restrictions encouraged the retailers to suppress the sales figures through different means, the government has now decided to keep increase in volumes as the only priority, according to Venkateshwar Rao.
The Telangana government, on the other hand, was also planning to introduce a separate category of liquor to be made available at a much lower price to keep people away from ID liquor as well as the chemical-mixed toddy, which has become a big menace in rural areas more than in Andhra Pradesh.
However, it had postponed its new policy by three months with a view to study the available options before finalising the new measures.
