Kerala: Government departments gear up to open liquor outlets, CPM vary

THIRUVANANTHAPURAM: Amid the indecisiveness over the opening of liquor shops in the state, the finance and taxes departments, the state beverages corporation and Consumerfed are busy completing formalities relating to the opening of liquor outlets.
The state government is yet to make a decision as advice from experts and the CPM is to ensure situation conducive for ensuring norms for social distancing before opening liquor outlets. On Friday, the CPM state secretariat that lauded the efforts of the government to contain Covid-19, advised that haste to open liquor outlet might lead to crowding that may further result in spreading of the disease. The secretariat asked the government to take a wait and watch approach, said sources.
It is also learnt that the finance department is seriously considering revising either the sales tax on IMFL or levying a surcharge over the IMFL price. Bevco and Consumerfed are in the process of sanitising the outlets and erecting barricades for crowd control, once the outlets are opened.
Even the flood of August 2018 that severely hit the economy had not affected liquor sales in the state, despite the government then hiking the excise duty on IMFL for a short period to collect some extra revenue towards the chief minister’s distress relief fund. The increased excise duty of IMFL for 100 days from August 16, 2018, had exceeded the government’s target, as it had fetched 50% more revenue than calculated. The government’s then additional earnings at the end of 100 days was Rs 309.9 crore.
Last time the state government had revised the sales tax on liquor was in 2018. The government had increased the sales tax on IMFL to 200% and 210% for IMFL brands costing up to Rs 400 and above Rs 400 respectively, in the budget of 2018. While sales tax was steeply increased then, the surcharge (which was 10%), social security cess (10%), medical cess (1%) and rehabilitation cess (5%) were discontinued, retaining only turnover tax (5%) other than the sales tax. In effect, the increase in the retail price of IMFL was only marginal then.
Meanwhile, the excise and police departments are taking a cue from states like Tamil Nadu and Karnataka which opened liquor outlets. Both states have a huge number of outlets when compared to the liquor outlets in the state. Tamil Nadu, with close to 6,800 TASMAC shops, had devised a detailed plan for ensuring that strict safety measures are adhered to. In addition to the barricades, the TN government has also deployed two police constables and two home guards in each outlet, along with a volunteer for managing the crowd.
Sources said that the government is not in a position to afford the loss of revenue from the sales of liquor at this point when already the economy is in dire straits. After the verdict of the Supreme Court which asked states to consider the online sales of liquor, the government is also exploring this possibility, a proposal originally raised by Bevco and rejected by the government two years ago.