Punjab Cabinet Approves New Excise Policy; Eyeing Rs 11k crore revenue

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Punjab Cabinet Approves New Excise Policy; Eyeing Rs 11k crore revenue

Friday, 28 February 2025 | PNS | Chandigarh

Punjab’s Aam Aadmi Party (AAP) Government on Thursday rolled out an ambitious new Excise Policy, aiming to generate Rs 11,020 crore in revenue for the financial year 2025-26 — an increase of Rs 874 crore (8.61 percent) from the previous year. One of the key reforms in the policy is the reintroduction of e-tendering for liquor vends, replacing the previous system of allotment through a lottery. Additionally, to curb illegal liquor trade, Excise Police Stations will be set up across the state.

 

The Government decided to allot liquor vends through an e-tendering process, reintroducing a policy first implemented in 2022. The quota for country liquor has been increased by three percent, while the excise duty on liquor has been revised, including a hike in the cow welfare cess from Re one per proof litre to Rs 1.5 per proof litre.

 

Apart from the Excise Policy, the Cabinet also approved major changes in the Punjab Registration of Births and Deaths Act, streamlining the process for obtaining certificates. Now, parents who fail to register their child’s birth within a year will no longer need a court order. Instead, they can complete the process through the Deputy Commissioner’s office. Furthermore, in cases of death due to illness, doctors will be required to specify the cause of death in the certificate.

 

In a major step toward environmental conservation, the Cabinet approved stricter penalties for polluting water sources. Offenders will now face fines ranging from Rs 5,000 to Rs 15 lakh, replacing the previous provision of jail terms. Additionally, the Punjab Tirth Yatra Samiti has been constituted to oversee religious pilgrimage programs, and 3,000 new government job positions were approved.

 

New Excise Policy: Revenue Boost and Structural Changes

Punjab Government has set an ambitious target of Rs 11,020 crore in excise revenue for 2025-26, surpassing last year’s Rs 10,145 crore. Finance Minister Harpal Singh Cheema, sharing details of the policy after the meeting, emphasized that excise collections have steadily risen under the AAP Government, comparing the revenue figures with previous administrations — Rs 4,405 crore during the previous year of the Shiromani Akali Dal (SAD)-BJP rule and Rs 6,254 crore in the final year of Congress governance. 

 

The new policy reinstated the e-tendering system for liquor vends, a move aimed at ensuring transparency and maximizing government revenue. The state has been divided into 207 liquor groups, each with an estimated revenue potential of Rs 40 crore. The move is expected to eliminate cartelization and promote fair competition. The government has also maintained a 25 percent flexibility in the group sizes to accommodate market fluctuations. 

 

To promote ease of doing business, wholesale license fees for ex-servicemen operating liquor businesses have been reduced by 50 percent — from Rs five lakh to Rs 2.5 lakh. Additionally, farm stay license holders can now store up to 36 bottles of Indian Made Foreign Liquor (IMFL), up from the previous 12-bottle limit, along with an increased quota for beer, wine, gin, vodka, and other liquors.

 

The policy also focused on encouraging investment in the state’s liquor industry. New bottling plants will be permitted, while standalone beer shop license fees have been slashed from Rs two lakh to just Rs 25,000 per shop, encouraging investment in beer retail. The automatic approval of liquor brands without price hikes through the e-Abkari portal further streamlines business operations.

 

A key enforcement measure in the new excise policy is the establishment of dedicated excise police stations — a first for Punjab. These stations will exclusively handle liquor-related violations, cracking down on smuggling and unauthorized sales. A special committee will determine suitable locations for these stations, ensuring better enforcement of excise laws.

 

In a socially-driven measure, the government has increased the cow welfare cess on liquor from Re one per proof litre to Rs 1.5 per proof litre, with estimated collections rising from Rs 16 crore to Rs 24 crore. The funds will be used for cattle welfare initiatives across the State.

 

The quota for Punjab Medium Liquor (country-made liquor) has been increased by three percent, reaching 8.534 crore proof litres.

 

Amendments in Birth and Death Registration Rules

 

The Cabinet has also approved significant amendments to the Punjab Registration of Births and Deaths (Amendment) Rules, 2025, aligning state laws with the Centre’s Registration of Births and Deaths (Amendment) Act, 2023. The biggest relief for parents is the removal of the legal hurdle in registering a child’s birth after one year. Previously, families had to approach the court for such registrations; now, this can be done through the Deputy Commissioner’s office with a self-declaration. Another major amendment mandates doctors to specify the cause of death in death certificates, ensuring accuracy and transparency in mortality records. This is expected to aid in better public health planning and prevent legal complications arising from vague death records. 

 

Strict Penalties for Water Pollution

 

The Punjab Cabinet has adopted the Water (Prevention and Control of Pollution) Amendment Act, 2024, which replaces criminal penalties with financial fines for water pollution violations. The new law introduces penalties ranging from Rs 5,000 to Rs 15 lakh for polluters, depending on the severity of the offense. Previously, offenders faced three months to one year of imprisonment for violations. The shift to financial penalties is in line with the Centre’s policy changes and is expected to create a deterrent effect while reducing the burden on the judicial system. The state will appoint an adjudicating officer to assess violations and impose fines, with major offenses still subject to existing criminal penalties. 

 

Punjab Tirath Yatra Samiti Constituted

 

The Cabinet has approved the formation of the ‘Punjab Tirth Yatra Samiti’, a new committee tasked with overseeing the Mukh Mantri Tirth Yatra Scheme. Under the revised framework, the scheme will now fall under the Revenue Department instead of the Transport Department. The new committee, to be directly overseen by the Chief Minister, will decide on the list of religious sites covered under the scheme. Since its launch in 2023-24, the pilgrimage scheme has facilitated travel for approximately 34,000 devotees to various religious sites by train or buses. The restructuring is expected to improve efficiency in managing future trips and enhance the overall experience for pilgrims.

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