The Hindu : Karnataka / Bangalore News : Hike in excise duty on IML criticised

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Saturday, Mar 29, 2008
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Karnataka

Karnataka - Bangalore

Hike in excise duty on IML criticised

Special Correspondent

Wine merchants see conspiracy by government
to bring back arrack
Excise duty on Indian made liquor increased
by 20 per cent

Bangalore: The Federation of Wine Merchants’ Association, Karnataka, on Friday criticised the decision of the State Government to effect a steep hike in the excise duty on Indian made liquor, terming it unfair and unjust, as it affected crores of people, particularly the poor.

Addressing presspersons, federation president Honnagiri Gowda, general secretary B. Govindraj Hegde and treasurer T.M. Meherwade said that the hike was unfair as the government had banned manufacture and sale of arrack claiming that it wanted to protect the health of consumers and would provide them with cheap liquor.

Mr. Hegde said that the sale of “seconds” and “thirds” could be curbed only when the price of liquor was less. The government has been getting very good revenue, because it sold IML at cheap rate when it also banned arrack. The government got a revenue of Rs. 2,119 crore in 2002-03 and it rose to Rs. 4,526 crore in 2006-07 and Rs. 4,088 crore this financial year up to February from liquor sales.

He said that the steep rise of 20 per cent will force the retailers to sell a quarter bottle of IML at Rs. 33 from Rs.27 and consumers will be hard hit by the government’s decision. The finances of the 7,600 licensees across the State will be badly affected as the consumers will switch over other mode of illicit liquor.

The federation leaders alleged a conspiracy on part of the government to re-introduce manufacture and sale of arrack from July, when the excise year commences on the premise that it wanted to supply cheap arrack to the poor and labour class, as they cannot afford to pay Rs. 33 a quarter bottle.

They said that the government was going to get another Rs. 400 crore by the end of the excise year and it was not facing any losses warranting a huge hike in the duty.

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