Liquor prices likely to drop by 30-40% in Punjab as Cabinet approves new excise policy

The new excise policy for the year 2022-23 was approved in the state Cabinet meeting chaired by chief minister here

Prices of liquor in Punjab are expected to drop by at least 30 to 40 per cent to be on par with the rates in Union Territory Chandigarh and Haryana, with the state Cabinet of the AAP-led government approving its first excise policy on Wednesday.

Chief minister Bhagwant Mann-led government set a target of collecting Rs 9,647.85 crore, 40 per cent up from the revenue mobilised from the liquor business last year.

The new excise policy for the year 2022-23 was approved in the state Cabinet meeting chaired by the chief minister here.

A spokesperson of the Chief Minister's Office said the policy strives to keep a stringent check over the smuggling of liquor from the neighbouring states through extensive enforcement and by incorporating new technological measures.

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Meanwhile, BJP leader Manjinder Singh Sirsa accused the AAP government of replicating the Delhi excise model to benefit a few.

“@Aam AadmiParty is abusing Punjab state machinery & replicating Delhi model of excise in Punjab to benefit a selected few," said Sirsa in a tweet.

The excise policy shall be applicable for a period of nine months from July 1, this year till March 31, 2023.

In another decision, the Cabinet also gave its nod to allot two special battalions of police to the excise department, in addition to the existing force, for keeping an effective vigil over the excise duty pilferage.

This will help in keeping a better check over the supply of illicit liquor in the state from neighbouring states, said the spokesperson.

The new excise policy aims to break the nexus of the mafia involved in the liquor trade, said the spokesperson.

The manufacturer, wholesaler and the retailer shall be at an arm's length distance from each other. They shall be completely isolated from each other with no common stakeholder between them, said the spokesperson.

Liquor smuggling from Chandigarh and neighbouring Haryana has been a major challenge for the state. The prices of liquor, including those of Indian, Made Foreign Liquor (IMFL) and beer on an average are 30 to 40 per cent higher in Punjab compared to the prices in Chandigarh and Haryana.

The prices of liquor shall now be almost on par with the neighbouring states, said the spokesperson.

According to the new excise policy, no quota has been fixed for lifting IMFL and beer by the retail licensees. However, the quota for the Punjab Medium Liquor (PML) remained what it was last year, said an official of the excise department.

The new excise policy stipulates to tap the actual potential of the liquor trade by allotting 177 groups through a free, fair and transparent manner of e-tendering. Earlier, liquor vends were allotted on the basis of the draw of lots.

The general size of the group shall be around Rs 30 crore and there shall be 6,378 vends in the state, said the spokesperson.

The excise duty on all kinds of liquor except PML shall be charged at the rate of one per cent of the wholesale price.

On the same pattern, the assessed fee shall also be charged at the rate of one per cent of the wholesale price, said the spokesperson.

To encourage capital investment and to increase the employment capability in the state, a provision for a new distillery licence and brewery licence has been made in the policy.

Further, a new licence for the production of malt spirit has been introduced in the state. This has been done to encourage crop diversification and provide better remuneration to the farmers, said the spokesperson.