State, which has some of the most expensive alcohol prices, is also mulling a Coronavirus cess
People wait for their turn at a liquor store in Kurla. Due to the existing high taxes, the state already witnesses the production of spurious liquor and smuggling. Pic/Sayyed Sameer Abedi
Even as tipplers lined up outside liquor stores across the state on Tuesday, there were hectic parleys both in the corridors of Mantralaya and the BMC.
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While for the state government, the main concern was how to raise revenue during the lockdown while ensuring that the infection rate does not explode, the civic body's sole concern was to keep the city's climbing COVID-19 count under check.
As reports flooded in about overcrowding outside liquor stores, the BMC commissioner made up his mind and issued an order late on Tuesday evening, directing all non-essential shops and establishments to shut with immediate effect.
The state agreed that this was the right decision for the hotspot of Mumbai, and decided to keep liquor stores open in the rest of the state. It is even contemplating a cess on liquor like in Delhi state, top sources in the political and bureaucratic machinery told mid-day.
Delhi imposed a Coronavirus cess on liquor sales at state-run shops from Tuesday. The cess is 70 per cent of the maximum retail price of all categories of liquor sold through standalone shops. The Maharashtra government's cess is expected to be less than that of Delhi, as the state's taxes on alcoholic beverages are already the highest in the country.
A retailer from Sion said a New Delhi-like cess is not advisable. "Even with the cess or surcharge, liquor in Delhi will still be cheaper than in Maharashtra. The taxation is so heavy that spurious liquor is made here or cheaper stuff is smuggled from neighbouring states," he said.
The high that didn't last
As per official data, the state has been consuming an average of 87 crore litres of alcohol (country liquor, Indian made foreign liquor, beer and wine) every year. The government earned R15,428 crore last year through liquor production and sale. The state has lost at least R3,000 crore in revenue in the current financial year.
Figures obtained by mid-day showed that the state sold 16.10 lakh litres and earned R62.55 crore on Monday and Tuesday. The figures are from 17 districts that sold liquor on the two days (including Mumbai city and suburbs). Nine other districts had disallowed sales, and two couldn't open stores.
"The excise department earns maximum revenue from production units. Liquor sale in the state touched R11-12 crore on Monday. A cess is a matter of policy for the government," said excise commissioner Kantilal Umap.
Some officials are of the opinion that the government could earn additional revenue through Value Added Tax (VAT) and GST if restaurants and permits room that serve food and alcohol were also allowed to open in the coming days. Owners of permit rooms and restaurants have sought permission to dispose of their stock in retail to get some liquidity and add to the revenue. But at least in Mumbai, the BMC order has put paid to these hopes.
Earlier in the day...
Before the BMC commissioner's order, the State Excise Department released a new set of guidelines for all liquor shops, which includes a form that customers will have to fill in with their personal details and take a token.
This order – an attempt to streamline crowds and enforce social distancing – apply to other districts, where liquor shops will continue to operate.
The forms to be filled by people include name, mobile number, details of the brand and the number of bottles the person wishes to buy.
The excise department said not more than 50 tokens can be issued per hour. With wine shops in the state allowed to be open from 10 am to 6 pm, assuming there will be 50 customers per hour, a wine shop can service a maximum of 400 customers per day. If more customers come, they will be issued tokens for the next day.
Wine shops that do not have printers to print the forms can put their stamp on a plain paper which has the details of the customer and mention the token number.
Inputs by Vishal Singh
3k
Amount (in crores) of revenue from liquor sales lost by the state
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