This is not a good news for tipplers. The Centre on Wednesday banned the sale of alcohol and tobacco during the next phase of the lockdown to contain the coronavirus outbreak. The Centre’s guidelines came even as states like Kerala, Tamil Nadu, Maharashtra, Uttar Pradesh and Punjab were mulling opening liquor stores, which have a major contribution to the
State economy.
Ahead of the extension, states like Assam had allowed the sale of alcohol while those like Meghalaya had set up a provision to ensure home delivery of the spirit so that social distancing norms are not violated.
After the fresh guidelines on Wednesday, Assam and Meghalaya have withdrew their order to open liquor shops.
Kerala had earlier allowed addicts to buy alcohol if they produce a doctor’s prescription but the Kerala High Court stayed the government order and the Indian Medical Association too had objected to it.
According to a fresh set of guidelines issued by the union home ministry, there should be a strict ban on sale of liquor, gutka and tobacco. The restrictions for public spaces also include a ban on spitting in public and the organisation of gatherings. The directives shall be enforced by the District Magistrate through fines and penal action under the Disaster Management Act 2005.
In the first phase of the lockdown, states had refrained from operating liquor stores to ensure social distancing norms are followed.
Many are turning to illegal liquor, say customs and police officials, who have seen a marked increase in seizures of hooch, which has in the past claimed thousands of lives among the poor unable to afford branded booze.
According to Google Trends, online searches for “how to make alcohol at home” peaked in India during the week of March 22-28, the same week Prime Minister Narendra Modi imposed the nationwide lockdown.
The liquor industry contributes about Rs 2 lakh crore a year to state governments by way of excise duty and in some states as value added tax, said an industry insider. Bulk of their tax outgo goes to state governments as liquor is a state subject. The liquor industry sustains livelihood of nearly 40 lakh farmers, and employs nearly 20 lakh people directly and indirectly.The central government’s indirect taxation of the industry is mostly limited to customs duty on import of concentrate.
“Excise duty on liquor is among the major revenue streams to state governments similar to GST on goods and services and excise duty on petrol and diesel. Kerala generates highest revenue from liquor sale every year,” said an official of the central excise department. The states that depend heavily on liquor for tax revenue are Tamil Nadu, Maharashtra, Uttar Pradesh, Punjab and Delhi.
The International Spirits & Wine Association of India (ISWAI), which represents India’s largest liquor makers, told the consumer affairs ministry that the suspension of alcohol sales is only helping the illegal trade.