Beer enthusiasts in Karnataka may soon face a price hike, while consumers of premium liquor could enjoy lower costs, as the state government prepares to revise alcohol rates. According to a report by The Hindu, the new pricing structure is expected to increase beer prices by ₹10 to ₹30 per bottle, while premium liquors could see a reduction of up to 20%.
Price Hike on Beer, Discounts on Premium Liquor
The increase in beer prices will vary depending on the brand and alcohol content. The state’s proposal aims to promote sales of Indian Made Liquor (IML), encouraging consumers to choose domestically produced brands.
This development comes shortly after Karnataka’s Deputy Chief Minister and Bengaluru Development Minister, D.K. Shivakumar, announced an impending water tariff hike, which could see water prices increase by 20-30%.
Implementation of New Pricing Expected to Take Time
While the government has initiated the process of revising the rates, it may take time for these changes to be fully implemented. The adjustments respond to longstanding demands from industry stakeholders who have been calling for a more competitive pricing structure. The revision also aims to reduce the cost of several popular liquor brands to increase overall sales and boost excise revenue for the state.
August 27 had initially been set as the deadline for implementing the new beer prices. This change was anticipated to bring Karnataka’s liquor prices in line with those in neighboring states, according to ABP Live. However, it appears that new stocks of liquor with revised rates have not yet reached the market. The final decision on beer pricing is expected to come only after all stakeholders have submitted their objections and feedback on the proposed changes.
Surge in Beer Sales and Changes in Consumer Behavior
Beer consumption in Karnataka has more than doubled over the past two years. A report by Deccan Herald links this increase to shifting consumer habits post-Covid, coupled with rising summer temperatures that have driven demand for chilled beverages.
Currently, beer is sold at a uniform rate across the state. However, the Excise Department’s proposed pricing model would introduce three distinct price categories based on the alcohol content. In addition, there is likely to be an increase in the Additional Excise Duty (AED) for both bottled and draught beer, contributing to the expected price rise.
Stakeholder Feedback Critical to Final Decision
The state government is still awaiting feedback from all stakeholders before making a final decision. This consultation process will determine the extent of the proposed price hike and reduction, ensuring that all parties are adequately represented in the revision.
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