Liquor stores, pubs report diminishing sales despite Karnataka govt’s tall claims

The Excise Department has refuted media reports on declining liquor sales, insisting that the state government's revenue had increased by 13.7 per cent compared to last year.

A reality check by DH, however, revealed a different story.

On August 25, 2023, a notification from the department rejected media claims about falling liquor sales and reduced state revenue, calling it “far from the truth”. It clarified that between April 1 and August 25, the government earned Rs 13,515 crore, achieving 37.5 per cent of the target set during the July 7 budget.

Last year, during the same period, the government earned Rs 11,887 crore, which means the revenue this year has increased by Rs 1,628 crore, a 13.7 per cent jump.

Initially, sales dropped as retailers stocked up on alcohol before the new rates took effect on July 20. Nonetheless, total liquor sales in the state have been 4.24 per cent higher than last year.

The excise department views the initial decline as expected and hopes it would stabilise and will grow consistent to the collection target of Rs 36,000 crore.

But DH's investigation revealed a drop in sales in city liquor shops. “We used to sell 40-50 crates of beer daily, but now it stands at 25-30 crates,” the owner of a popular MRP store on Jalahalli Cross said. “People opt for cheaper brands and buy less.”  

The Rs 30-Rs 50 additional charge in pubs and bars prompted people to sidestep them and buy liquor directly from MRP stores, impacting footfalls in the joints.

Employees laid off 

A well-known pub near Brigade Road said it had laid off eight employees due to low profits as a result of diminishing patronage.

A supplier to the pub explained: “Due to price hikes, people are drinking less, affecting our sales and making it hard to cover rent and salaries.”

A collective of pub and bar owners plans to meet the chief minister soon to discuss the negative impact of the excise duty hike on their businesses.