Bengaluru: Following a recent reduction in the prices of premium liquor, residents of Karnataka may face a rise in beer prices. The increase, expected to range from Rs 10 to Rs 30 per bottle, will depend on the brand and alcoholic concentration.
The proposed price hike comes in response to the significant growth in beer sales in Karnataka over the past two years. Post-Covid recovery and extreme summer heat have driven up beer consumption, making it more popular than Indian Made Liquor (IML). Beer sales in the state have more than doubled, reflecting this shift in consumer preference.
In the financial year 2023-24, the Karnataka Excise Department collected nearly Rs 5,703 crore, a substantial increase from the Rs 2,757 crore collected in 2021-22. This increase in revenue is partly attributed to the surge in beer consumption.
Currently, beer is subject to a flat excise rate, but the Excise Department has proposed introducing three different slabs based on the alcohol strength of the beer. This change would also see an increase in Additional Excise Duty (AED) for both bottled and draught beer. The proposal includes requiring beer manufacturers to display the “minimum percentage of malt and sugar by weight” on their labels and doubling the AED for microbreweries.
The decision to adjust beer prices follows a recent strategy to reduce premium liquor prices in order to boost sales of IML. The state government has emphasized that the final decision will be made after considering objections from all stakeholders.
This proposed increase in beer prices marks the third adjustment under the Siddaramaiah government. With beer sales surging, the new excise duties are expected to generate additional revenue for the state.
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