Liquor makers urge Bengal govt not to implement proposed excise policy

Manufacturers of alcoholic

beverages have written to West Bengal Chief Minister Mamata Banerjee, urging her not to go ahead with the proposed new excise policy as it will hurt the liquor industry.

In a joint representation to the chief minister, two major liquor makers' associations -- Confederation of Indian Alcoholic Beverage Companies (CIABC) and International Spirits and Wines Association of India (ISWAI) -- said consumer prices of the fast-moving brands will go up by 40-90 per cent under the new policy.

The increase of sales tax on liquor by 30 per cent in April this year has led to a drastic fall in sales, which resulted in lower collections for state exchequer, the liquor makers said.

"Excise policy proposed by the West Bengal Excise Department on August 19, 2020 has created great concern amongst companies. The industry fears that this policy will create undue disruptions and even possible job losses just before the peak puja time," CIABC director-general Vinod Giri said.

The proposed policy also uses a "deeply flawed concept of inter-state price comparisons" because the operating conditions vary across states, he said.

"Under the proposed policy, consumer prices of the fast-moving brands will go up by 40-90 per cent, as a consequence of the changes in taxation and in the trade margins," the associations said in the representation.

He pointed out that consumer price differences between West Bengal and the neighbouring states, which was already high after the imposition of VAT in April this year, will go up even further if this policy is implemented.

The policy will hurt the industry, leave thousands of people jobless and affect the government's tax collections, he added.