Karnataka Government Raises Excise Tax On Beer And IMFL

“Even after the increase in excise rates, the price of liquor in our state would be lower when compared to the neighbouring states,” the Chief Minister said in the budget speech.

Written by Shruti Chaturvedi July 7, 2023

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Karnataka Government Raises Excise Tax On Beer And IMFL

In presenting the State Budget for 2023–2024 to the Legislative Assembly on Friday, Karnataka Chief Minister Siddaramiah announced an increase in additional excise duty on beer and IMFL.

In addition to raising the additional excise duty on beer from 175 to 185 percent, the government also hiked the existing rates of additional excise duty on Indian Made Foreign Liquor (IMFL) by 20% on all 18 slabs.

“Even after the increase in excise rates, the price of liquor in our state would be lower when compared to the neighbouring states,” the Chief Minister said in the budget speech.

The Excise Department’s tax collection target for the fiscal year 2023–2024 has been set at Rs 36,000 crore with these increases and efficient enforcement and regulatory procedures, Siddaramaiah noted.

The budget published in February by the departing Bommai administration set an excise target of Rs 35,000 crore.

JK Arora, MD, SOM Distilleries immediately responded to this development by telling ET that while any price rise is counterproductive to consumption, in this case the 20% increase in IMFL and 10% increase in beer will promote beer consumption.

“Another advantage that you see is a nip of whiskey will cost more, so people will switch over more to the beer, so it is indirectly advantage to the company,” he added.

Karnataka Chief Minister Siddaramaiah also stated that roughly Rs 52,000 crore would be spent annually for the five important electoral “guarantees,” and it is projected to help 1.3 crore families, during the budget session in an effort to highlight the pledges made by the Congress party.

He claimed that through the five “guarantees” (poll promises), the government will be giving each household an additional financial support of Rs 4,000 to Rs 5,000 per month on average.

The 2023–2024 budget has an outlay of approximately Rs 3.27 lakh crore.

The five “guarantees” included free bus transportation for women, 200 free power units, 10 kilogrammes of foodgrains for the underprivileged, Rs 2,000 for the female head of household and up to Rs 3,000 in jobless benefits.

By submitting his 14th budget to the Assembly as Finance Minister, Siddaramaiah broke the previous record of late Ramakrishna Hegde, a former CM, who had submitted 13 budgets.