Karnataka set to auction unused liquor licenses for revenue generation
The Karnataka government is likely to issue a notification next week regarding the auction of unused liquor licenses, including CL-2 (retail liquor shops), CL-9 (bars and restaurants), and 11-C (government-owned Mysore Sales International Limited retail outlets), sources have confirmed. The move follows an announcement by Chief Minister Siddaramaiah in his March 7 budget, which proposed allocating these unused licenses through a transparent electronic auction process to aid in the state’s resource mobilization.
According to the sources, there are around 600 unused licenses across the state, with approximately 200 CL-2 licenses, 100 CL-9 licenses, and 293 MSIL licenses that will be auctioned. The Excise Department is currently preparing a list of these licenses, which will be submitted to the government for allotment across districts. While Bengaluru Urban District (BUD) is expected to receive the majority of CL-9 licenses, the final decision on the auction and allotment will rest with the government.
BUD is divided into eight excise districts, with the highest revenue-generating district being the eighth, which includes areas like BTM Layout, Hosur Road, and Anekal taluk.
The state’s CL-2 and CL-9 licenses have not been issued since 1992, while MSIL licenses were issued in 2009 and 2016, after which there was a freeze. This has led to a high demand for these older licenses, making them highly valuable for the current holders.
Likely price hike in Indian Made Liquor
In addition to the license auction, the government is also expected to increase the prices of Indian Made Liquor (IML) in the lower segments next month. Sources suggest that there may be a marginal rise in the Additional Excise Duty (AED), resulting in a price hike of Rs 10 to Rs 15 per 180ml bottle for the lowest four slabs, where the Maximum Retail Price (MRP) ranges from Rs 65 to Rs 80. These price increases are expected to contribute significantly to excise revenue, as these lower-priced IML products account for around 80% of the state’s total excise revenue.
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