Karnataka Proposes New Liquor Tax Policy to Reshape Pricing Structure
Liquor prices to change in Karnataka: States where buying booze is still costly, and where alcohol is cheap
Mint
Image: Mint
Karnataka, India, has introduced a draft policy to change liquor taxation to an Alcohol-in-Beverage (AIB) system, potentially increasing prices for budget liquor while reducing costs for premium brands. This reform could make Karnataka the first Indian state to adopt AIB, impacting liquor prices across the country.
- 01Karnataka proposes an Alcohol-in-Beverage (AIB) taxation model for liquor.
- 02The new policy may increase prices for budget liquor but decrease them for premium brands.
- 03Karnataka currently has the highest liquor tax in India at 83%.
- 04Maharashtra, Rajasthan, Telangana, and Uttar Pradesh also have high liquor taxes.
- 05Goa remains the most affordable state for liquor due to a lower tax rate.
Advertisement
In-Article Ad
Karnataka has unveiled a draft policy aimed at transforming its liquor taxation system to the Alcohol-in-Beverage (AIB) model, which taxes based on the actual volume of alcohol. This change could lead to higher prices for budget liquor while premium spirits might see a decrease in cost. Currently, Karnataka imposes an 83% tax, making it one of the most expensive states for liquor. The state is inviting feedback from industry stakeholders until April 25. If implemented, Karnataka would be the first Indian state to adopt this model, potentially influencing other states to follow suit. Other states with high liquor taxes include Maharashtra at 71%, Rajasthan at 69%, Telangana at 68%, and Uttar Pradesh at 66%. Conversely, Goa offers the lowest liquor prices, with a tax rate of 49%. Despite high taxes, Telangana leads in liquor spending, with an average annual expenditure of โน1,623 (approximately $20 USD) per capita on alcoholic beverages.
Advertisement
In-Article Ad
The proposed changes in liquor taxation could lead to increased prices for budget-conscious consumers in Karnataka, while potentially benefiting premium liquor buyers with lower prices.
Advertisement
In-Article Ad
Reader Poll
Do you support the proposed liquor tax reform in Karnataka?
Connecting to poll...
More about Brewers Association of India
Read the original article
Visit the source for the complete story.