Excise department fails to meet target by 20%

The already cash-strapped state government may face a further crunch with the state excise department meeting less than 80 per cent of its revenue targets of Rs 14,340 crore by end of February. State excise revenues are the third-largest contributor to the state’s kitty after state GST (SGST) and stamp duty and registration.

According to excise department’s data, it achieved Rs 11,336.60 crore (79.06%) of its Rs 14,340 crore target by February-end. However, this is 9.53% more than Rs 10,350 crore collection for the corresponding period in the previous year. The 2018-19 budget set a Rs 15,343.08 crore collection target for the state excise department.

A senior official attributed the tepid rise in collections to the de-growth in liquor sales across all categories and the Supreme Court’s restriction on liquor vends at a 500 meter distance from national and state highways after March 31, 2017, which affected consumption.

The original order covered 15,699 of 25,513 liquor licenses and though the SC later exempted liquor vends in municipal areas, around 7,305 licenses remain shut today. Last year, beer manufacturers had also halted production for two months after an excise duty hike, leading to a drop in sales.

According to figures, beer sales have shown a sharp 14.21% fall to end at 2,483.78 lakh bulk litres (LBL) from April 2017 to February 2018 compared to 2,895.06 LBL for the same period the previous year. This is followed by the Indian Made Foreign Liquor (IMFL), where sales dipped 6.67% to end at 1,622.98 LBL versus 1,739.06 LBL; country liquor at 2,839.63 LBL against 2,947.75 LBL (down 3.67%) and wine, which fell 2.92% from 57.60 LBL to 55.92 LBL.

“However, despite 2017-18 being a bad year for the liquor industry, our revenue collections are around 9.5% higher than the previous year though we fell short of the revenue target. The Rs 14,340 crore target was a hike of over 15% than the Rs 12,287.91 crore collections in 2016-17, which made it unrealistic and difficult to achieve,” the official explained. He said that the state excise department was likely to get another Rs 700 crore in March as license renewal fees, which could take the final collection figures to Rs 13,400 crore by March-end.