ThePunjab Cabinet led by Chief Minister Captain Amarinder Singh on Monday approvedthe Punjab Excise Policy 2021-22 with a projected target to mop up Rs.7002crores through excise revenues as against the current year’s revenue of Rs.5794crore, showing an increase of 20%.
Overall,the Excise policy has been largely focused on providing relief to retaillicensees and to keep buoyancy in liquor trade.
Accordingto a spokesperson of the Chief Minister’s Office, the policy aimed at renewalof the existing vends, subject to lifting of additional liquor by thelicensees, ensuring a minimum growth of revenue of 12% during 2020-21. Therevenue of current year is expected to Rs.5794 crore as against Rs.5027 croreof previous year, showing an increase of 15%.
Thespokesperson further said that the state government is banking on the superbperformance of the Excise department during the year 2020-21 despite Covid-19disruptions, which is now slated to garner around Rs. 300 crores over and abovethe budgeted target of Rs.5578 crores. If successful, the government would beable to jump from Rs.5073 crores in 2019-20 to Rs.7000 crores in 2021-22, anincrease of whopping 40% in two years. The department proposes to collect theadditional revenue by increasing the quota (minimum quantity to be sold by alicensee) of Punjab Medium Liquor by 12%, Indian made Foreign Liquor ( IMFL) by6% and Beer by 4% over last year respectively. In a first, the department hasproposed to impose a quota for foreign liquor in Municipal Corporation areasand ‘A’ Class municipalities.
TheExcise policy has been formulated specially to give relief to those sections ofthe society which were affected negatively due to Covid-19. Not only has theAnnual Fixed license fee for bars in hotels & restaurants been slashed byaround 30% but the fee on consumption of liquor (assessed fee) has also beenreduced. The Annual Licence fee for marriage palaces has also been reduced by20%. This relief will go a long way in supporting the badly affected hospitalitysector during the Covid phase. The Policy allows Renewal of existing vendssubject to lifting of additional liquor by the licensees. It is likely to bringstability in the liquor trade and will also generate additional revenue for thestate exchequer. The government has not increased the incidence of taxes oncountry liquor thereby maintaining the last year liquor prices for theconsumers. This would help sale of legal liquor and the department to combatsale of cheap illicit liquor which is hazardous to life and health ofconsumers. There would be no increase in sale price of liquor.
Inview of the success achieved through ‘Operation Red Rose’ the department hasresolved to continue the enforcement activities under the said operation withfull vigour. The department proposes to introduce more technology in trackingthe manufacture, movement and stocking of liquor in the state.
Thewholesale trade of liquor would be monitored online by the Government replacingthe present L-13 wholesale licensees. The conversion quota has been increasedfrom 15% to 20%. The fix and open quota percentage has been kept at 30:70 asexisting.
TheState Government has also decided to place a moratorium on setting up of newDistilleries, Breweries or Bottling plant. It has also decided no new Letter ofIntent (LoIs) will be issued for establishing manufacturing units in thecurrent year. The government has also made it mandatory for the LoIs issued forsetting up of a Bottling Plant to complete their project by March 31, 2023.
Inorder to maximise the revenue, a minimum guaranteed quota for imported foreignliquor has been introduced in Municipal Corporations, A-Class MunicipalCommittees etc. The L-1 (Import)/L-1BB licensees shall have to procure IFL fromthe custom bonded warehouses situated in Punjab only.
Toencourage ethanol manufacturers and proper utilisation of agriculture produce,a new license (E-2) has been introduced for setting up an ethanol baseddistillation plant with a nominal fee.
Theborder areas of the State of Punjab have been given relief by converting 25% ofthe Fixed License Fee (FLF) to Additional Fixed License Fee (AFLF).