Wanna get our awesome news?

Subscribe to our newsletter!


Actually we won’t spam you and keep your personal data secure

As the voice of the Indian restaurant industry, we represent the interests of 500000+ restaurants & an industry valued @ USD 4 billion. Whether a chain or independent restaurant, the NRAI is here to help every step of the way. Join us!


State Wants You to Drink More Liquor, Less Beer



Government authorities force shops to buy more liquor because it attracts a higher excise duty compared to beer.

Wondered why the waiter at your favourite restaurant said “sorry, we have run out of beer” and looked sheepish when you asked “how come?” Here’s the answer: Excise authorities are forcing restaurants and liquor shops to procure higher amounts of Indian-made foreign liquor (IML) by restricting supply of beer.


Screen Shot 2016-06-22 at 12.41.38 pm Duty on liquor is one of the biggest revenue earners for the  state government. IML sales registered a 15.89% increase in  2013-14 but dropped by 7.58% in 2014-15. As the expected  revenues did not flow in, there is apparently “pressure from  the government” to get excise licence holders to sell more  IML. “If we procure 50 litres of IMFL, they give us just 10 litres of beer as the tax levied on IML is more,” said Ashish Kothare, head of the Bengaluru chapter of the National Restaurant Association of India. Nagesh Babu, member of Federation of Wine Merchants’ Association of Karnataka, said officials harass liquor shop owners. “They never give us what we ask for. The duty on beer is less. The government generates revenue from IML the same day it is dispatched from the warehouse,” he said.

Karnataka State Beverages Corporation (KSBCL), comprising employees from the excise department, is the sole regulator and distributor of liquor in the state. The excise department is concerned with meeting revenue targets. For bars and liquor shops, it translates into dissatisfied customers. “More IML means we have to force customers to consume this over beer. Alcohol content is more in IMFL. It is more harmful than beer,” Kothare said.

“Most youngsters prefer beer to other drinks. We are losing business because of this,” said the owner of a bar on Brigade Road, who did not want to be named. “The Excise Department thinks we are making huge money by running a bar and restaurant, which is untrue. Earlier, the department used to force us to take more stocks. Now, they are forcing us to sell more IML.”

The Karnataka State Temperance Board has hit out against the Excise Department. “On the one hand, we are trying to get people to quit alcohol. The Excise Department is forcing people to consume liquor. This is bad. Who are they to decide what people should drink,” Board chairman MR Rangashamaiah asked.

Excise Commissioner SR Umashankar initially admitted to the existence of the practice. “In summer, most liquor shops purchase only beer because of the incentives offered by beer companies. As a result, there was imbalance in sales and our officials are trying to balance IML and beer.” Holding that the department will not put a cap hence-forth, he said, “In case of any deviation, licence holders can approach me directly.”

Principal Secretary (Finance) ISN Prasad, who also chairs the Karnataka State Beverages Corporation Limited, said he was not aware of the issue.

Source: Economic Times, Bangalore

Recommended for you