States should press Centre for opening of liquor sale: CIABC

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SME Times News Bureau | 23 Apr, 2020
Pointing out that the states have already lost around Rs 20,000 crore in revenues during the lockdown period so far, the Indian alcoholic beverage industry has urged state governments to impress upon the Centre on the urgent need to start sale of liquor in non COVID-19 hotspots.

It has also sought opening of retail and on-trade (pubs, restaurants etc) establishments in non-COVID-19 hotspots and commencement of online sales and home delivery under strict government supervision to check overcrowding in shops and fulfil the criteria of social distancing.

In its letter to all Chief Ministers (barring states which are under prohibition), the Confederation of Indian Alcoholic Beverage Companies (CIABC) has stated that "Constitutionally alcohol is a state matter, and hence it is state government which should unequivocally be the only authority to permit or not permit trade in alcohol."

CIABC is the apex body of the Indian Alcoholic Beverage Industry with members including major Indian companies who manufacture and market their product range in India and abroad.

The letter pleaded that, "the State Governments to take up the matter once again with the Centre to permit production, distribution and sales of alcoholic beverages outside containment zones, in conformity with COVID-19 guidelines."

This is the second letter written to the Chief Ministers since the lockdown began.

CIABC also asked states systemic changes in the way the alcoholic beverage industry works to ensure social distancing in future. In this regard it said that there should be greater push for technology-based controls in place of physical man-based controls on production/warehousing sites and on stock in transit. In addition new sales channels, which do not need gathering of people, such as home deliveries through dedicated portals or government's websites should be looked at.

"In these difficult times when entire industry and economic activities are shut, the states' coffers are taking a big hit. Indian alcoholic beverage industry is the major source of revenues for the state governments. It contributes around Rs 2 lakh crore per annum as revenues to the government. Tax on alcohol consists of 20-40 per cent of tax revenues of States. A total ban on liquor deprives state governments of own revenue so vitally required in fighting COVID-19. We employ 20 lakh workforce and assist livelihood of 40 lakh farmers. Under current circumstances when our earnings are zero, we cannot sustain for long. This will lead to huge job cuts and massive financial losses. The state governments need to urgently consider opening of sale," CIABC Director General Vinod Giri said.

Giri further noted that prolonged unavailability of legal alcohol has serious consequences. "There are growing reports of liquor smuggling, sale of illicit and spurious liquor, and looting of shops. These not only deprive state of legitimate tax revenues, they also pose grave threat to public health and law & order."

Significantly, Punjab and Maharashtra state governments have already taken up the matter with the Union Home Ministry for opening of liquor shops. Delhi and Maharashtra have also been pushing for online sale and home delivery of liquor.