Journalism of Courage
Lt-Governor Najeeb Jung’s order to fund public transport in the city by imposing a cess of Re 1 on every packet of cigarette and liquor bottle has left the Excise department looking for options to implement the order without changing existing rules.
As officials struggle to find a way to impose the cess, the department said one of the options under consideration is to increase Value-Added Tax (VAT).
“We have a policy for calculating liquor rates. For beer, it is in multiples of five and for other liquor, it is calculated in multiples of 10. Considering that we have just increased the liquor prices under various segments, we would need to find another way to implement this cess,” an official said.
The prices of liquor went up by 8 per cent to 12 per cent under various segments in July. Prices of Indian Made Foreign Liquor (IMFL) have gone up by Rs 25 and Rs 40 per bottle when new rates were notified by the Excise department.
Officials had a meeting with the Environment department as well to find out a way to implement the Lt-Governor’s decision. “We will soon put up a proposal on how to accommodate this Rs 1 cess. And the better way would be to increase VAT rather than increasing the price per bottle as then we have to revise the rules to do that,” an official said.
“We would not like the liquor prices to go up as it may have an adverse impact on revenue. We would propose a way where the cost will not get transferred to the customer. We are working at a proposal that will soon be sent to the Lt-Governor for final approval,” the official said.
