A SHOT AT RECOVERY
India Today|May 10, 2021
Marking a major departure from its conservative liquor policy, the Rajasthan government, on April 1, issued a notification allowing bars in the state to operate microbreweries.
Rohit Parihar

The state’s excise department is its second-largest source of tax revenues and, after 15 years of stagnation, Chief Minister Ashok Gehlot has finally ushered in changes. The move has surprised many since Gehlot, a teetotaller and professed Gandhian, is not known to be sympathetically inclined towards stakeholders in the liquor business.

The apparent change of heart and the new liquor policy are, in fact, driven by the desperate need to shore up state revenues—for possible government interventions during the ongoing pandemic. The loss of revenue has, of course, been exacerbated by the pandemic and its devastating effect on tourism. A new, more liberal liquor policy, it is reasoned, might ease the flow of revenues into the state coffers. To this end, aside from the go-ahead for microbreweries in bars, new excise rules were also announced on February 6.

The state has also allowed an additional 2,100 urban vendors to sell both IMFL (Indian-made foreign liquor) and country liquor, raising the total number of vendors selling both IMFL and country liquor from 5,600 to 7,700. The new policy also does away with the lottery system for the allotment of liquor shops. In its place, an e-auction system has been introduced. Welcoming the move, Nilesh Mewara, president of the Rajasthan Liquor Welfare Society, says: “This will give genuine bidders better choice and a chance to own two shops in a city and five in the state, as opposed to the earlier lottery system. Many winners used to sell off their shops.”

The policy has also done away with the much-reviled Covid surcharge, which will reduce the rates of beer and other ready-to-drink bottled alcoholic beverages by 20 per cent. The excise department has set a revenue target of Rs 13,000 crore this year against Rs 11,500 crore last year, when, due to the Covid lockdowns, the state could only reach Rs 9,700 crore, says T. Ravikant, secretary, revenue. “This year, the government has already earned Rs 9,890 crore from the auction, with another Rs 500 crore expected from the auction of the leftover 600 shops,” he adds. An additional Rs 3,500 crore will come from the various fees applicable.

Gehlot has also earmarked Rs 500 crore for tourism in the state. “These are pleasant surprises,” says Randhir Vikram Singh Mandawa, president of Indian Heritage Hotels Association, co-chairman of FICCI Rajasthan State Council, and CMD, Mandawa Hotels. “Gehlot has thought about us when the Centre has been indifferent to the Corona-massacred tourism sector.”

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