Bihar election 2025: Will voters end the state's decade-long liquor ban?

Bihar's decade-old liquor ban has cost lives, drained revenues, and fuelled illicit trade-now it's a central election issue with parties divided on repeal or reform

As Bihar heads to the polls in two phases on November 6 and 11, with results due November 14, the state’s decade-old prohibition law has taken centre stage in the political discourse, not just for its moral framing but for its tangible fiscal and social impact. 

Launched in April 2016 as a social reform initiative by the Nitish Kumar’s government, the alcohol ban is now being debated through the lens of lost revenues, illicit trade, and the mounting toll of spurious liquor deaths. With public discontent rising, several parties are calling for reform or repeal.

 

How prohibition drained Bihar’s excise revenue 

When the excise department shut all legal liquor sales, Bihar gave up a major source of own-tax revenue. In 2015–16, excise collections stood at around ₹3,142 crore. By 2016–17, that figure dropped to about ₹30 crore, nearly wiping out the stream.

 

   

A CAG report stated that prohibition led to a revenue shortfall of ₹1,490 crore in 2016–17 alone. Analysts estimate that over the years, the excise revenue loss amounted to about 1 per cent of Bihar’s GSDP and more than 15 per cent of its own tax revenues annually.

 

To plug the gap, Bihar ramped up property registration revenues (₹7,648.88 crore in 2024–25), seized and auctioned vehicles, and leaned heavily on central transfers. However, none have fully matched the certainty and scale of excise receipts. The result: tighter budgets, overdependence on Union funds, and constraints on state-level spending.

 

What other states earn from alcohol taxes 

Unlike Bihar, other large states draw heavily from liquor excise. Delhi’s excise plus VAT revenue on liquor hit ₹7,484 crore in 2023–24. Uttar Pradesh, one of India’s highest earners, is targeting ₹63,000 crore from alcohol excise in FY26.  Also reaad: Bihar polls: Bulk SMSes, voice messages during 'silence period' on EC radar

 

These comparisons highlight the scale of foregone revenue Bihar continues to grapple with.

 

Spurious liquor toll shows a human cost to prohibition 

Since the ban’s rollout in April 2016, Bihar has recorded 190 deaths from spurious liquor, with districts like Saran, Siwan, Gaya, and Bhojpur among the worst affected. The 2022 Saran hooch tragedy alone killed over 70 people.

 

The illicit trade has remained persistent. Till March 31, 2025, over 936,000 prohibition cases were registered and 1.432 million arrests made. Authorities seized 38.6 million bulk litres of liquor and auctioned over 74,000 vehicles, raising around ₹340 crore.

 

While supporters of the ban cite reduced domestic violence and better health outcomes, critics argue that unsafe alternatives have flourished due to unaddressed demand.

 

Political fault lines: repeal, reform or retain? 

The Jan Suraaj Party, led by Prashant Kishor, has made the repeal of prohibition a central campaign plank. The party claims scrapping the ban would recover ₹28,000 crore annually, to be leveraged for development loans from the World Bank and IMF.

 

The Rashtriya Janata Dal (RJD) has proposed softer measures, such as exempting traditional local brews and dropping minor cases. It argues that the law disproportionately penalises small producers while failing to stop large-scale trafficking.

 

Meanwhile, the NDA, under Chief Minister Nitish Kumar, continues to defend the policy on moral and public welfare grounds. It points to social benefits like curbed alcohol dependence and reduced violence in homes.

 

2025 elections: a verdict on prohibition itself 

Beyond seat tallies, Bihar’s 2025 election may serve as a referendum on prohibition. Voters face a stark policy choice: uphold a moral initiative with clear trade-offs, or pivot toward a pragmatic reversal to recoup revenues and curb illicit trade. 

Key figures from a decade of Bihar prohibition

• Liquor Ban in Numbers (2016–2025)
• Excise revenue loss: ₹3,142 crore annually (pre-ban baseline)
• Deaths from spurious liquor: 190 confirmed fatalities
• Prohibition cases filed: 936,000
• Arrests made: 1.432 million
• Liquor seized: 38.6 million bulk litres
• Vehicles auctioned: 74,725 (₹340 crore raised)