Brace to pay more for your favourite booze

KOLKATA: The chief minister has till now refrained from increasing taxes and has, on the contrary, stuck to populist measures like reducing 4% VAT on cooking gas, resulting in a Rs 75 crore (approximate) burden on the exchequer.
Thus, your firewater will be costlier to help the state's finances look up a little. So, brace to pay more for your favourite booze.Liquor prices are all set to soar to a pre-festive high, as the Mamata Banerjee government is finally taking the fast lane to better revenue generation.
And excise, an indirect tax on manufactured goods that producers generally pass on to consumers, is a significant source of revenue for state governments and collections from liquor form a sizable chunk. The surest way of shoring up the revenue was the moot point in the several meetings held at Writers' Buildings over the past two days. Finance minister Amit Mitra has been holding these intense sessions on Monday and Tuesday to fix the rate of the hike. "The calculations at the end of the meeting were rather complex. The rate of per bulk litre increase for the prices of India-Made Foreign Liquor (IMLF) will vary as the government has imposed an advalorum duty structure in which the excise duty is linked to the MRP. So, a brand of whiskey may be costlier by 10 per cent while the low-on-alcohol content beer would only cost about 6 per cent more," said a source at Writers'.
The ad valorum structure means higher duty on products with higher MRPs and low on those with low MRPs. Consequently, those who want to keep their MRPs low could do so at their own cost. Official left the final calculations to retailers and distributors which can be estimated only when the circular is issued.
As part of its better revenue generation exercise, the government is also trying to grant licences to more and more bottling plants - letters of intent have already been given to 12 such companies in the last two months.
All these will be reflected in the budget which is due to be placed by August or September. The erstwhile Left Front government had placed a vote-on-account for the period between April 1 and July 31. The new government, which has inherited a Rs 2-lakh crore debt, bought time and placed another vote-on-account for August 1 to September 30. Now, it must place a budget for the remaining six months.