Assam: Liquor prices are set to increase by 10-15 percent coming into effect by Friday December 10. This move comes after the Assam Government has taken the decision to hike the excise duty in order to compensate the loss from VAT reduction on petrol and diesel.
However, no additional taxes have been levied on beer and wine.
Effect of the move
The tax will be higher for costly liquor in Assam. The price of the costly liquor is set to increase upto 15 percent while that of the low price liquor will go up by 5 percent.
The need for the move
In a report by Hindustan Times published on November 13, it was stated that the States and UTs have made the decision to cut VAT on petrol and diesel following the Centre’s announcement to significantly reduce central excise duty on these fuels on Diwali eve.
As many as 25 states and union territories have therefore reduced Value Added Tax(VAT) on petrol and diesel to provide relief to consumers.
Earnings from past
In the Fiscal year 2001-02, the State Government earned Rs. 148 crore excise revenue against Rs. 2,033 crore in 2020-21.
In this Fiscal, the department has set a target of Rs. 2,400 crore excise revenue collection.
According to official sources, the State Government did not issue licenses for liquor and wine shops after 2001. It, however, issued licences for bars during that period. In recent times, the State Government has decided to issue licences for wine shops at a few select locations.
The state has 1,234 liquor and wine shops, 318 alone in Guwahati. The number of bars in the state is 996.
It is to be noted that most of the states that announced a reduction in VAT on petrol or diesel are either ruled by the Bharatiya Janata Party(BJP) or its allies, Hindustan Times report.