Liquor sales pick up in Karnataka after drop in revenue due to COVID-19 lockdown

Liquor outlets in the state were closed for close to two months as a result of COVID-19-induced lockdown.
Liquor vend
Liquor vend

Despite the COVID-19 induced lockdown, which shut down liquor outlets and bars, and led to a dip in sales for close to two months, Karnataka’s Excise Department is well poised to emulate revenue collections of the previous financial year 2019-20. Data compiled by the department shows that while the revenue for April-November 2019 was Rs 14,390.39 crore, this year, it was only short by Rs 612.09 crore at Rs 13,778.30 crore. This means that as of November-end, the cumulative revenue collection was only 4.25% less compared to the excise revenue generated by November-end last year.

The deficit has been reduced from 58.15% to 33.49% to 21.26% to 15.07% gradually at the end of May, June, July, August respectively, as per the data.

Liquor stores in the state were allowed to open with limited timings on May 4, after they were closed down on March 25. Bars and pubs were allowed to open only on September 1, after a gap of five months.

However, senior excise department officials said that while there is a steady recovery of sales year on year, the revenue generation has been aided by the additional excise duty that was introduced in the state budget. In terms of beer, only November saw a growth on a year-on-year basis while for hard liquor, there has been a year-on-year growth since September.

“We have another three months to go for March. The sales have picked up only recently. Otherwise even though the year-on-year deficit in revenue had gone down gradually, we had not seen a spike in sales until September. The decrease in revenue had been recorded due to the increase in additional excise duty. What was lost in 45 days of April, it is a little difficult to get back that Rs 2,000 crores. If there is regular revelry during December-January, then maybe we can make up the deficit in sales as well,“ Excise Commissioner Yashwant V told TNM.

In fact, while the revenue deficit year-on-year at the end of November is at 4.25%, the sales deficit is at 11.19% for Indian Made Liquor and 33.58% for beer.

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