Thursday, February 26, 2009

Quota in liquor vend allowent

Excise policy: 4 pc VAT imposed, allotment through sealed bids.

Chandigarh, February 16 RESERVATION IN allotment of liquor vends, allotment by inviting vend-wise sealed bids and imposition of 4 per cent Value Added Tax (VAT) on wholesale licensee are some of the high lights of Haryana's Excise policy for 2009-10 announced today.

Announcing the policy in Vidhan Sabha, Excise and Taxation Minister Birender Singh said reservation in allotment of vends for Scheduled Castes and Backward Class (A) had been made to ensure their participation in the state's economic growth.

"The liquor trade has by and large remained a monopolistic enterprise. But now SCs and BCs can participate," he said at a press conference later. The policy was approved by the Cabinet earlier in the day.

Birender Singh said for the first time a reservation of 10 per cent has been made for SC members and 5 per cent for those of Backward Class (A) in allotment of country liquor and IMFL vends. The 15 per cent reservation would be district wise.

He announced single stage VAT of 4 per cent on liquor for wholesale licensees. The levy effected for the first time, will increase the cost of liquor, trade sources said.

He said the new policy was a major shift from previous policies as far as allotment of vends was concerned. For 2009-10, allotment would be done by inviting vend-wise sealed bids, like in Andhra Pradesh.

"The previous government used to auction vends and that system was followed by the present government for a year. Thereafter, it was changed to lottery system to put an end to the monopoly. The excise policy since 2006-07 has successfully achieved the path-breaking objective of breaking the cartels and unethical dominance of liquor mafia, broadbasing the trade by facilitating the entry of new players of even modest means, plugging the leakage, and optimization of revenue. The main purpose of bringing this policy is to assess the financial potential of each vend," he explained.

Singh said the new policy also has an enabling provision to renew licenses for 2010-11.
However, the criteria for renewal will be decided in next year's policy.

The Minister said 60 per cent of basic quota of country liquor will be distributed equally amongst all Haryana-based distilleries while 40 per cent shall be open quota.

For opening bars (L4 and LS), the licence fee has been fixed at Rs 6 lakh in Panchkula, Faridabad, Gurgaon and Yamunanagar and Rs 4lakh in the remaining districts.
For opening of pubs in Hisar, Panipat, Sonipat, Yamunanagar, Faridabad and Gurgaon districts, a licence fee of Rs 3 lakh would be charged but in other districts it would be Rs 2 lakh. The government has decided to stick with its 2008-09 policy decision pf pro viding licenses for 24X7 bars for four and five-star hotels.

Referring to the issue of payment to local bodies in lieu of taxes imposed by them, Birender Singh said as per the new policy panchayats would get Rs 2 per bottle, instead of Rs 1.50 earlier. Similarly, the Municipal Committees would get Rs 3 per bottle instead of Rs 2 earlier. The ratio of sharing the payment between Gram Panchayats, Panchayat Samitis and Zila Parishad would be 70:20:10. (Haryana Bureau)

Birender Singh said the government expects an increase of Rs 500 crore in Excise revenue i.e. about Rs 2,000 crore during 2009 10 through the new excise policy. He said this was despite the number of liquor vends having been reduced to 3,500 from 3,800 in the new policy.
Also, sale hours in rural areas have been reduced by one hour in summers (April to October) and two hours in winter (November to March).

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