Domestic liquor makers urge the Kerala Govt. to end the tax difference discrimination

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The Federation of Alcohol Beverage Producers (India) (FABP) has raised the issue of alleged discrimination against the India-made foreign liquor (IMFL) industry in Kerala.

On Sunday, the liquor makers have demanded the Kerala government to not impose additional sales taxes on the Indian made foreign liquor (IMFL) as the existing taxes and margins on IMFL are higher than other imported liquor.The taxes and margins on IMFL in the State come up to 240 per cent, compared to 88 per cent for imported liquor, said FABP.

In a letter to the Kerala government, the Federation of Alcohol Beverage Producers (India) noted that the reason given for the tax difference is that consumer prices for imported liquor need to be kept low to prevent smuggling from other States — is totally baseless, as prices in those States are either higher or the same and that they had taken up the issue in many meetings with the government holding adequate supporting documents concerning the tax difference discrimination.

“We are not aware of any other State or country which so blatantly discriminates against its own products, its own industry, its own farmers and its own workers,” Vinod Giri, Director General, FABP, said in a letter to the State government.

“This is in our view is taking the matter to bizarre proportions. Just to give you a reference after this the tax difference between the two will go to an incredible 189 per cent. Instead of rectifying the error, the Government is further compounding it,” he added.

Therefore, the association requested to review the Excise Policy of Kerala and issue necessary amendments to remove glaring discrimination in favor of imported products.The Kerala government promised to look into the concerns of the domestic liquor industry and that would be duly addressed in Excise Policy of 2020-21, no such provision was made, it added.