The Maharashtra government has announced a significant increase in excise duties on alcoholic beverages as part of its efforts to boost state revenue. This move comes amid ongoing fiscal challenges and is expected to have a substantial impact on liquor prices across the state. The new excise duty rates will come into effect soon, affecting both manufacturers and consumers.
Under the revised structure, the excise duty on Indian Made Foreign Liquor (IMFL) has been raised from three times to 4.5 times the declared manufacturing cost, with a cap set at ₹260 per bulk litre. Meanwhile, the duty on country liquor has increased from ₹180 to ₹205 per proof litre. These changes are anticipated to push retail prices higher by roughly 15 to 25 percent, particularly affecting mid-range and premium IMFL brands. For example, a 180 ml bottle of rum priced at ₹145 may see its cost rise to around ₹160.
In addition to the excise duty hike, the state has introduced a new category called Maharashtra Made Liquor (MML). This category will be reserved exclusively for locally manufactured alcoholic beverages and requires new registrations for producers. This initiative aims to promote indigenous production and strengthen the local liquor industry.
The state excise department is also undergoing operational reforms to enhance efficiency and compliance. Among these are the implementation of AI-based monitoring systems to oversee distilleries, bottling plants, and wholesale licenses. The department will establish a new divisional office in Mumbai along with six additional superintendent-level offices across key districts. Furthermore, 1,223 new posts will be created, including 744 regular and 479 supervisory positions, to bolster the department’s capacity.
With these changes, the Maharashtra government expects to generate an additional ₹14,000 crore annually, significantly contributing to the state’s revenue goals. This increased revenue is crucial for balancing fiscal pressures and funding public services.
Consumers will notice the price hikes once the new duties are applied to fresh inventory. Existing stocks in the market will continue to be sold at the older rates. As a result, customers are encouraged to purchase alcoholic beverages before the new excise duties come into effect to benefit from the current pricing.
However, the move has raised concerns within the hospitality sector. Bar and restaurant owners fear that higher prices may lead to reduced patronage and impact their business adversely. There are also worries that the increased cost of legal alcohol could drive some consumers towards illicit and unregulated liquor, which poses health risks.
