High liquor cost in Uttarakhand may lead to smuggling from Uttar Pradesh
It’s a double whammy for liquor trader Dharmendra Singh who was allocated a shop in the Dehradun district last financial year
It’s a double whammy for liquor trader Dharmendra Singh who was allocated a shop in the Dehradun district last financial year. Singh is in dilemma whether to go for the bidding for another one year. Reason: the new policy has increased the cost of liquor across brands anything between 10-15%.
After the revised rates, drinks become expensive in the hill state in comparison with the neighbouring Uttar Pradesh.
Singh said the Uttarakhand government’s policy was though aimed at achieving inflated revenue targets but it was in no way going to help tipplers and traders.
“If the liquor is cheap in Uttar Pradesh than why someone should buy from Uttarakhand? The decision will hurt everybody,” Singh said.
Four districts of Uttarakhand, including Dehradun, share the boundary with UP. And the route connecting Garhwal and Kumaon regions via Haridwar also passes through UP.
Traders fear that comparative cheap liquor will also mean smuggling from the Uttar Pradesh. A quick look at middle segment brand reveals that a popular low budget brand that costs ₹423 in UP (at wholesalers end) is available for ₹575 (at wholesalers end) in Uttarakhand.
Similarly, another popular brand which is sold for ₹496 at wholesalers end in UP becomes R 670 in Uttarakhand. These rates are before the Value Added Tax is calculated.
Moreover, Punjab and Haryana are already dubious for sending a large number of smuggled liquor into the state.
Excise minister Prakash Pant accepted that smuggling was a concern but he claimed that rates are “under control” in most of the brands and won’t affect the business in the state.
“Allotment of shops is a transparent process and we will not let anyone smuggle liquor into the state. A new software is on the anvil that will trace the origin of a liquor bottle once it leaves the factory,” Pant told HT.
If liquor rates are one concern that the excise department’s condition asking shop owners to keep a fixed amount of liquor whether they are able to sell or not is another concern.
“What the dealer will do if he has to submit a certain amount every month and is also have to buy a certain amount of liquor on monthly basis. It does not matter to the excise department whether it is sold or not. But this is not the case in UP where the dealers can keep quota as per the demand,” said a senior sales official of a liquor brand.
Uttarakhand has set a target of earning to the tune of ₹2,600 crore in this financial year after the department failed to earn the desired revenue for two years in a row.
The minister said other states could be following other ways as far as fixing liquor quota is concerned but Uttarakhand will continue with it. (Some names withheld on request)