Kerala’s Decision To Sell Liquor Through Private Bar Counters Draws Flak, Critics Say State Outlets Will Lose Revenue

The decision of the Left Democratic Front (LDF) government in Kerala to allow the retail sale of liquor through private bar counters has drawn criticism as it could affect income to the state coffers.

Malayalam daily Malayala Manorama quoted unnamed experts as saying that Kerala would stand to lose heavily by allowing the retail sale of liquor by bar counters.

The LDF government, led by the Communist Party of India-Marxist (CPM), will likely begin the sale of liquor from tomorrow (21 May), though the outlets were expected to begin sale earlier this week.

On Monday, Chief Minister Pinarayi Vijayan said that the State would begin liquor sales once the online registration is completed. The registration is with regard to a mobile app that will issue tokens for the purchase of alcohol.

Vijayan said that liquor would be sold only as a takeaway, while clubs can sell liquor along with food as parcels for their members. Besides bar counters, beer and wine parlours will also sell alcohol.

Over 500 bars and 225 beer and wine parlours have registered their consent to sell liquor as takeaways in Kerala so far.

Until now, liquor in Kerala was sold through the 265 outlets of the State Beverages Corporation (BEVCO) and 35 Consumer Federations.

The Vijayan government is amending the Kerala Abkari Act which will permit the sale of liquor through bar counters. The arrangement will likely be continued even after the nation-wide lockdown to counter the spread of novel Coronavirus (Covid-19) is lifted.

Allowing the retail sale of liquor by bar counters will help its owners earn huge sums that would have in the normal course gone to the exchequer.

With retail sale by bar counters and wine and beer parlours now allowed, that income stands to be pruned, the daily quoted experts.

While allowing the sale of liquor in the state, the Kerala government has raised the taxes on alcohol by 10-35 per cent.

Taxes on wine and beer have been raised by 10 per cent, while an additional cess of 10 per cent will be levied on liquor bottles below 600ml. All other forms of alcohol will incur a 35 per cent tax.

According to the State Finance Minister Thomas Isaac, Kerala will earn an additional revenue of Rs 2,000 crore from the tax hike on liquor.

Kerala earns Rs 2,500 crore annually as taxes through the sale of liquor. Sales through BEVCO and Consumer Federation outlets during 2018-19 fiscal were reported at Rs 14,500 crore.

Liquor sale in Kerala has been suspended since the nation-wide lockdown was announced on 24 March.

At one point of time, the State contemplated issuing licence to tipplers as the government got concerned over suicides by those suffering from withdrawal symptoms. The decision was, however, stayed by the Kerala High Court.

The number of those who committed suicide due to withdrawal symptoms is higher than those who have died of Covid-19 in the state. Till now, four persons have died due to Coronavirus, while the State has reported 642 positive cases.