Maharashtra Liquor Prices Set To Jump As Govt Announces 5% VAT Hike On Alcohol

Maharashtra Liquor Prices: Liquor prices in bars, lounges and cafes in Maharashtra are set to increase as the state government plans to raise the Value Added Tax (VAT) by 5% starting November 1. The finance department has officially announced that the VAT rate for permit room liquor services will now stand at 10%, a significant jump from the previous 5%. While experts anticipate an initial drop in sales due to this decision, they believe it will eventually stabilise.

Critics argue that this hike unfairly targets the restaurant industry, creating a distinction between wine shop sales and on-site consumption. Such a move is expected to impact the restaurant sector, which employs significantly more people than the retail industry.

Sukesh Shetty, President of AHAR, an association representing over 15,000 premium hotels, bars, and restaurants in the MMR region, voiced concerns about the potential negative impact on employment in the industry.

The increased liquor prices in Maharashtra may drive customers towards more affordable alternatives, like off-premise consumption in locations such as building terraces, parks, beaches, or parked vehicles. Furthermore, there are discussions within the Maharashtra government about introducing a new excise policy that links pricing to the alcohol content of beverages.

This could potentially lower beer prices and serve as a revenue-boosting strategy. However, the specific details and the timeline for implementing this proposed policy are still subject to ongoing deliberation.