The 5% rehabilitation cess was meant to support thousands of bar employees, who had lost their jobs.

Rs 600 crore collected as liquor cess in Kerala fails to reach laid off bar employees
news Liquor Friday, June 02, 2017 - 09:51

The ruling Left Democratic Front Government in Kerala on Wednesday decided to waive the requirement for no-objection certificates from local bodies for bar and liquor outlets. This will now pave the way for the reopening of 60 liquor shops in the state.

The state government decided to issue an ordinance amending the relevant clauses of the Kerala Municipalities Act and the Kerala Panchayat Raj Act that will do away with local bodies having a say in permitting liquor shops in their limits.

The norm requiring a no-objection certificate from local bodies was introduced by the previous United Democratic Front government.

The UDF in its 2014 liquor policy had also introduced a 5% rehabilitation cess on each and every bottle of liquor. The cess was meant to support thousands of bar employees, who had lost their jobs after the closure of over 700 bars in the state.

During the past two financial years, the Kerala State Beverages Corporation (Bevco) has collected around Rs 600 crore through the cess, reports Vikram Vinod of The Times of India. "Reply to a RTI request revealed that Bevco collected Rs 290.31 crore as rehabilitation cess during the financial year 2015-16. In 2016-17 the amount rose to Rs 308.74 crore. A total of 599.05 crore was collected in two years," the report states.

But the cess collected has not reached its beneficiaries – the thousands who were promised rehabilitation following the closure of the bars. Quoting a minister in the UDF government, the report states that nothing has been spent on the bar workers.

Thiruvananthapuram district president of the Kerala Hotel Bar Owners Association Sunil Kumar said, “Before the policy implementation we were told that the cess would be used to rehabilitate employees but after the policy came into effect they added alcohol awareness and rehab for addicts.”

As most of the bar workers were part of unorganised sector, they were ineligible to claim any rehabilitation benefits.


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